Ms Catherine King (Ballarat, Australian Labor Party, Shadow Parliamentary Secretary for Treasury) Share this | Link to this | Hansard source

In November 2002, the Prime Minister commissioned a review by Mr John Uhrig of the corporate governance of statutory authorities and office holders. On 12 August 2004, Mr Uhrig’s report Review of the corporate governance of statutory authorities and office holders was publicly released. The Uhrig report made a number of recommendations to improve the governance of statutory authorities and office holders and their accountability frameworks. The Governance Review Implementation (Science Research Agencies) Bill 2007 is part of the response to recommendations in that report. The bill seeks to implement recommendations in relation to three statutory authorities: the Australian Institute of Marine Science, the Australian Nuclear Science and Technology Organisation and the Commonwealth Scientific and Industrial Research Organisation. Labor is supportive of measures which will improve the governance of statutory authorities. The implementation of the Uhrig report is currently used as the way to increase the efficiency and transparency of the operations of statutory authorities. Labor intends to support this bill as part of its commitment to consistency in the governance of statutory authorities.

The bill implements the recommendations in the Uhrig report for frameworks most suited to a particular agency. In the review’s assessment of AIMS, ANSTO and CSIRO, it was concluded that a board framework would best suit those agencies. For each of the three agencies, changes have essentially been made in respect of: the appointment of the CEO of each agency by the relevant board rather than by the Governor-General; provisions relating to the termination of and other arrangements for a CEO and acting CEO; and the removal of a legislative requirement for ministerial approval of contracts for expenditure above a prescribed value, as consistent with section 15 of the Commonwealth Authorities and Companies Act 1997. The CEO of the Australian Institute of Marine Science will now have a maximum appointment of five years instead of seven years. The approval for entering contracts for AIMS will now be consistent with section 15 of the Commonwealth Authorities and Companies Act by repeal of section 42 of the Australian Institute of Marine Science Act for ministerial approval of contracts for expenditure above a prescribed value, currently $1 million. This requirement will be replaced by a requirement set out in the minister’s statement of expectations, the minister being notified in advance of AIMS entering into significant contracts.

The current structure of the Australian Nuclear Science and Technology Organisation, which consists of the executive director and ‘not fewer than two nor more than six other members’ under section 9 of the Australian Nuclear Science and Technology Organisation Act 1987, is changed to require that the board consists of a CEO and at least five but not more than eight other members. This implements the recommendation that six to nine members, including an executive director, is best practice for governance by a board. The approval for entering contracts for ANSTO will now be consistent with section 15 of the Commonwealth Authorities and Companies Act by repealing section 31 of the ANSTO Act for ministerial approval of contracts for expenditure above a prescribed value, currently $5 million. This requirement will be replaced by a requirement set out in the minister’s statement of expectations that the minister is notified in advance of ANSTO entering into significant contracts. The title of the chief executive of ANSTO will change from executive director to chief executive officer, for consistency with commercial practice. As with the other two science research agencies, changes are also made in respect of the appointment of CEOs and their relationship to the board.

The approval for CSIRO contracts will be consistent with section 15 of the Commonwealth Authorities and Companies Act. Section 50 of the Science and Industry Research Act—for ministerial approval of contracts for expenditure above a prescribed value, currently $5 million—will be repealed. This requirement will be replaced by a requirement set out in the minister’s statement of expectations, with the minister being notified in advance of CSIRO entering into significant contracts. The minimum number of CSIRO board members will be increased to five members other than the CEO. A position of deputy chairperson of CSIRO will also be created in recognition of the increased workload of the chairperson. Labor notes the changes in relation to the CSIRO board and amendments to allow the appointment by the board of its CEO. These changes, however, do not address issues of concern raised last year in the media as to the apparent gagging of CSIRO scientists, in relation to reports on climate change, by the Howard government and management of that organisation. Although structural changes to the management of CSIRO which implement the Uhrig recommendations will make improvements to its management, they certainly do not make the organisation immune to politicisation. Governance changes alone do not in fact ensure independence in the face of a government that fails to respect the independence of its scientists.

This bill will also establish CSIRO as a body corporate with perpetual succession which must have a seal; which may acquire, hold and dispose of real and personal property; and which may sue and be sued. Section 9A of the Science and Industry Research Act will be amended to remove the need for ministerial approval for CSIRO to accept gifts, as consistent with existing arrangements for ANSTO and AIMS. Labor is committed to ongoing improvements in the corporate governance of statutory authorities. The implementation of the Uhrig report recommendations in respect of the application of the Financial Management and Accountability Act and the Commonwealth Authorities and Companies Act frameworks will increase consistency in the corporate governance of statutory authorities and is therefore welcomed by Labor.

(Quorum formed)

Michael Ferguson (Bass, Liberal Party) Share this | Link to this | Hansard source

This morning I rise to speak in support of the Governance Review Implementation (Science Research Agencies) Bill 2007. There was some confusion with the speakers list, but it is good nonetheless to be able to debate and address this bill. The bill that we are debating this morning, and which will soon be summed up, is designed to amend the Australian Institute of Marine Science Act 1972, the Australian Nuclear Science and Technology Organisation Act 1987 and the Science and Industry Research Act 1949. The bill will implement changes to the governance arrangements of the Australian Institute of Marine Science, ANSTO and CSIRO to reflect the government’s response, and implementation of that response, to the recommendations of the Review of the corporate governance of statutory authorities and office holders, which we in this place better know as the Uhrig review.

I would like first of all to make some comments about the Uhrig review and its importance. As part of its 2001 election platform the coalition government signalled its intention to examine the efficacy of governance arrangements of statutory authorities and office holders. In November 2002, the government announced a review of the governance practices of those statutory authorities and office holders, with a special focus on those agencies which impact on the business community—a very important constituency for this government, as it should be for all of us. The Prime Minister appointed Mr John Uhrig AC to head this review, the objective of which was to examine and evaluate governance arrangements and practices and to ‘provide policy options for government to get the best from statutory authorities and office holders and their accountability frameworks’. In doing so, the government noted the impact that the performance of statutory authorities and office holders has on business and the overall health of the Australian economy.

The review focused on the areas where businesses have the right to expect higher levels of efficiency, fairness and transparency in their dealings with government. While they are agencies to anybody in the business community, for all intents and purposes they really are government organisations and the business community does have a reasonable expectation to have an open, accountable and businesslike interface with government. A key task of the Uhrig review was to develop a broad template of governance principles that, subject to consideration by government, might then be extended to all statutory authorities and office holders. As part of the process of developing this broad template, the review was asked to consider the governance structures of a number of statutory authorities and office holders with critical relationships with business and to consider best practice corporate governance structures in both the public and private sectors. The report recommended that two templates be considered to ensure good governance of statutory authorities. Agencies should be managed by either a chief executive officer or a board structure. Both templates detail measures for ensuring the boundaries of responsibilities are better understood and the relationship between the Australian government authorities, ministers and portfolio departments is made clear. However, as Mr Uhrig explained in his review, the purpose of the template is to ‘serve as a reference point’ for the development of governance arrangements and so it is ‘expressed as an ideal’ which the government ought to consider and respond to.

Uhrig recommended that the selection of the management template and financial frameworks to be applied be based on the governance characteristics of a statutory authority. The amendments that we are debating to the Australian Institute of Marine Science Act will enable the AIMS council to appoint and remove the CEO, who is currently appointed by the Governor-General, and also will remove the requirement for ministerial approval of contracts for expenditure above a prescribed value, which is currently $1 million. This will improve the efficiency and I would suggest also provide a sense of corporate respect in which the government will hold that organisation. Amendments to the Australian Nuclear Science and Technology Organisation Act will specify that the board will consist of six to nine members, including the executive director, remove the requirement for ministerial approval of contracts—in line with the other organisations—which is currently $5 million, and change the title of the chief executive of ANSTO from executive director to CEO.

Finally, the Science and Industry Research Act amendments will enable the board to appoint and remove the chief executive. Currently the chief executive is appointed by the Governor-General. The amendments also create a position of deputy chairman in recognition of the high workload—and perhaps unreasonable workload—that the chairman has been carrying, make explicit that the board may delegate any or all of its powers, remove the legislative requirement for ministerial approval of contracts, which in this case is currently $5 million, and require the chief executive to seek the approval of the board, rather than the minister, for the payment of bonuses or intellectual property rewards to CSIRO staff. They also remove the need for the minister’s consideration when the CSIRO is offered a gift.

The bill makes changes to the governance of AIMS, ANSTO and CSIRO to implement the recommendations of the Uhrig report, which the government endorsed in August 2004. It will allow them the freedom to act that was recommended in the Uhrig report while maintaining appropriate levels of accountability.

Critics have said that the proposed amendments reduce accountability. To respond to that, I believe it is important to explain to this chamber that changes to the agencies’ governance arrangements do not reduce accountability at all. Rather, they uphold strong governance and in fact enhance the ability of the bodies to interact effectively with business and the wider community.

While the amendments provide greater freedom of the board/council to act, this is entirely in accordance with the recommendations of the report. And there are still requirements which must be noted, in the enabling legislation for each agency as well as in the Commonwealth Authorities and Companies Act, which ensure an appropriate level of accountability. In addition, the minister’s statement of expectation for each agency will require the agency to keep the minister fully informed of significant events and to consult with her on significant matters.

Each agency will also be subject to a quadrennium funding agreement, which will cover the four financial years commencing 2007-08. It will specify performance indicators for the agencies and agreed key areas of reporting to the Minister for Education, Science and Training and the Minister for Finance and Administration.

As for claims that changes to appointment arrangements for the CEOs of AIMS and CSIRO represent a diminution of their current terms of appointment, they are also not correct. It has to be acknowledged that the bill contains transitional provisions that preserve the terms, conditions and tenure of the current CEOs of the Australian Institute of Marine Science and the Australian Nuclear Science and Technology Organisation. The only exception to this is that the CSIRO board and the AIMS council, rather than the minister, will approve any leave of absence for the current CEOs.

As for claims that the appointment of a deputy chairperson of CSIRO is an unnecessary expense: the remuneration for the deputy chair will be set by the Remuneration Tribunal and the cost will be met out of CSIRO’s existing budget and, therefore, will have no financial impact. The considerable increase in the responsibilities of the chairperson over recent years does justify the creation of the extra position of deputy chair, and the arrangement is quite consistent with arrangements that are in place for ANSTO and other large statutory bodies.

The amendments to these acts are part of a range of changes that are being implemented by the government. I understand that they are relatively non-controversial. But they will, it is important to acknowledge, improve the governance arrangements and the effectiveness of the interface between these organisations and the government and—very importantly—business and the wider community.

I wish to direct a few comments, in relation to the bill, to some measures which were announced on Tuesday night which are terribly important to the future of these organisations. The organisations that are the subject of today’s amendment bill are implicitly involved in the mathematics and science communities and the greater goal of enhancing and improving educational standards in the areas of science and maths.

As a former maths and science teacher myself, and as a parent, I have a great concern for the future of maths and science in our schools and in our wider community. There is evidence that standards have fallen around Australia, and we must arrest that decline. That is why I was very pleased to see, on Tuesday night, that funding of $457.4 million has been made available for the national literacy and numeracy vouchers program. This has been discussed quite widely in the media in recent days and has been very warmly welcomed, particularly by parents but also by schools and teachers.

The vouchers will provide direct assistance to parents of students who have not been able to achieve minimum standards in reading, writing and mathematics in years 3, 5, 7 and 9 so that they can get additional help for their children. This help can be sourced out of the private sector, outside of school hours. This is a wonderful way that this government is showing support for those children in both government and non-government schools who, for whatever reason, have fallen behind. It would be welcome if the Tasmanian government’s education minister and his state colleagues would welcome this funding, because it is very significant and has every prospect of arresting the decline in standards in the lives of some of our young people.

There is also funding in the budget of $100 million for a brand new initiative which, again, is very significant. The new summer schools for teachers program will provide extra professional development opportunities for teachers and will have the flow-on effect, quite obviously, of improving the quality of teaching and the quality of learning outcomes in our young people. It will specifically relate to the major disciplines of literacy and numeracy, English, maths, science and Australian history.

An additional $53 million is being provided for another brand-new initiative: rewarding schools for improving literacy and numeracy outcomes. If schools can demonstrate that they have, by altering their teaching program or by improving the way in which their classes function, made sustained improvements in student literacy and numeracy, a very significant cash reward of $50,000 can be given. This can then be reinvested into school programs for continual improvement. I point out that this is not funding for schools that are performing highly; this is funding for schools that are able to improve. So there ought to be no controversy around it. It ought to be something that every school can strive to achieve.

There is also additional funding of $13 million over two years to implement something which I have been very passionate about for a long time—that is, for the Commonwealth to work with the states and territories to develop core curricula standards in a range of subjects, including English, maths, physics, chemistry, biology and Australian history for college-level students and also a range of subjects to year 10. This, I hope, will assist in raising standards in schools, and I trust that the states and territories will also contribute resources of their own to achieve the agreed goal of improving consistency around Australia for our students in very important subject areas.

I now turn to funding which has been made available to the specific organisations which are the subject of this bill. In fact, funding of $6½ billion in the coming financial year marks the highest amount ever spent by any Australian government on science and innovation programs. This will build on the very large investment of the $5.3 billion commitment made in 2004 through the Backing Australia’s Ability: Building Our Future Through Science and Innovation package.

The budget announced by the Treasurer on Tuesday night included funding of $50 million to support the Australian Synchrotron, in Victoria, in addition to a substantial package of funding for medical research facilities through the health portfolio. The Synchrotron will have wonderful benefits not just for pure science but also for the health and research sectors and the industry sector in the development of high-tech objects. In addition, it includes funding of $8 million over four years for Australia’s four learned academies.

CSIRO will receive $2.8 billion, including $244 million for new measures over the next four years, including expansion of a flagships program, which has been widely welcomed by the community. There will also be additional funding to support construction of the Australian Square Kilometre Array Pathfinder, funding of $16 million for the Australian Animal Health Laboratory to improve diagnostic testing of new and emerging diseases and an additional $2 million to develop a wellbeing plan for children.

Finally, ANSTO and AIMS will be supported. ANSTO will receive an additional $61 million for new measures. That will be used for the operation of the new OPAL reactor. There is funding for the automation of the radiopharmaceuticals and industrials production processes and $4 million for low-level radioactive waste compaction equipment which will substantially reduce the volume of low-level waste stored at ANSTO. AIMS will receive an additional $5 million to support research into marine ecosystems in north-west Australia, which will underpin environmental protection and sustainable use of marine resources.

I look forward to the Leader of the Opposition’s speech tonight. I am sure he will welcome all of those initiatives and acknowledge that they are a necessary part of the response by the Australian government and the parliament to securing Australia’s future. With those comments, I again state my support for this bill and commend it to the House.

Bernie Ripoll (Oxley, Australian Labor Party, Shadow Parliamentary Secretary for Industry and Innovation) Share this | Link to this | Hansard source

I rise to speak on the Governance Review Implementation (Science Research Agencies) Bill 2007. Can I say at the outset that Labor supports this bill. It is a mechanical bill and one that addresses a number of corporate governance issues. It follows on from a report that was commissioned by the government—the Review of the corporate governance of statutory authorities and office holders, by John Uhrig, which was undertaken in 2004. The Uhrig report is a good report. The report made a number of recommendations to improve the governance of statutory authorities and their office holders and also to improve the accountability frameworks within those institutions. It is an important document because it goes a long way to improving the way that these three very important institutions work. These three statutory authorities—the Australian Institute of Marine Science, the Australian Nuclear Science and Technology Organisation, and the Commonwealth Scientific and Industrial Research Organisation—are very important to Australia in science and research and through the roles they play in making Australia a more competitive and more innovative country. They give us the ability to compete with our neighbours.

Labor are supportive of the measures in this legislation because we do want to improve the governance of these bodies. We think it is important that they operate smoothly, that they run efficiently and effectively and that they deliver something in return for the public funding they receive. So there is no argument there at all.

A number of measures contained within the Uhrig report have been adopted in this bill. I will not go through all of them. They have been mentioned by other speakers in this debate and they are of a technical nature. They include a range of issues which will bring these statutory authorities into line with other authorities, bodies and boards. They go to the standards expected in the 21st century as to how these authorities, their board members and their membership will operate. They cover rules and also, very importantly, transparency.

While Labor support these measures, we are very conscious of the independence of these organisations—and I think it is an important issue for the community and the public to take note of—and the need to ensure that the research, the work that they do and the outcomes of the work are independent not only of government but also of politicisation. It is important to understand that these bodies play a significant role in Australia’s development, in our scientific base, in teaching and in research. It is a sad day when governments start to interfere at a political level in the work of these organisations, in their structures or in the appointment of staff to these bodies. Politicisation, as we have seen from the Howard government, is certainly an issue. We have seen the politicisation of our defence forces right through to the politicisation of CSIRO. It is important to note that these changes do not make these organisations immune from political interference or politicisation, and we should do the best we can to respect the independence of these scientists and these organisations.

This bill is important for a number of reasons—not just because of the technical nature of the improvements it makes but also in relation to the broader science and research that is undertaken in Australia. A dialogue has been taking place in the community for quite a number of years—which Labor has been at the forefront of—about productivity, growth, industry and innovation, about how we build sustainability in our industries and about how we compete. These conversations, policies and viewpoints have been out there for quite some time from the Labor side, even at a time when they were considered by many people, particularly those in government, not to be important enough to warrant attention through either budgets or legislation.

Through perseverance, if nothing else, Labor has managed to put the issues of innovation and industry at the forefront of thinking at a government level and also at a community level. I think there is a greater understanding now of the things that we need to do to maintain our position in global markets. I will talk a little about the Productivity Commission report on those very issues as well. Even these minor mechanical legislative amendments contained in this bill build a broader policy machine. This larger policy machine is the nature of the government’s support for public scientific research in Australia. In this respect, Labor has some very clear policy goals that match up with our broader approach to industry, to innovation and to building sustainability. Labor also believes in the social and economic worth of sustained and comprehensive government support for our public scientific research institutions—not the dumbing down of those institutions, the ripping out of funds, interference and then, at some later point in time, deciding that that support is important again and therefore providing some extra funding. I think the principle should be that it is always important that government supports these institutions in the work they do.

If the government does not get that message, I can certainly tell the government that the community does. There is a lot of public support for scientific research and the way it improves our economy. Society as a whole probably has a greater understanding than people will grant. The Howard government on the other hand, I believe, has lost sight for many years of what public scientific institutions should be, how they operate and why they should receive significant government support. This translates as a lack of vision on the part of the Howard government. It is highlighted by the fact that there is a distinct failure to tie together scientific research, innovation and industry. A lot of money goes into these areas. We have just heard from the previous speaker about the billions of dollars and some of the new measures in the budget that support some of these institutions. While this is certainly welcome, and we welcome it in this election year, it has been very slow in coming. I think that has had a detrimental effect on our ability to innovate and compete.

But it goes further. That lack of coordination between what we do at all those levels is having a broader impact on our abilities. We can look at specific industry areas where we are falling behind, particularly in the area of innovation—for example, manufacturing and a range of other industries. We can see that what is happening now through policy and funding is a catch-up game. Catch-up games in these areas are no good. By the very nature of innovation, you can never catch up. By definition, innovators are those who lead; they are not the ones who follow. This government is less than innovative in its approach to these areas. The government follows many years behind; it has a huge lag. We keep comparing ourselves with OECD countries such as Britain, Canada, the United States and certain parts of Europe. We are lagging behind in our R&D spend. It is not only about the dollars we spend but also about how it is coordinated, about the rules and guidelines, about how we treat foreign entities and innovators in this country and about our commercialisation principles and how we aid those people in business—the real innovators and the real leaders who take the risk upon themselves regardless of government. We do not see much support. We see a lot of money going into a whole range of areas, but when you start to look at the disparate parts of industry and innovation policy you really do have to ask the question: where is the bang for the buck? What does the community, as taxpayers, get in return for the massive amounts of money that go into these areas? I do not for one minute begrudge the money that goes into these areas—in fact, quite the opposite. I am very supportive because I think there is real progress to be made through proper funding channels in key areas of industry, through industry policy generally and in building innovation in our community, in our business leaders and also in the three statutory bodies that are within this bill. So there is a lot of work to be done.

It may be the case in other policy areas, but in this policy area it is certainly not the case that you can just wait for things to get bad, look around the world and see what everyone else is doing and decide, ‘We’ve fallen behind a fair way so now is the time to catch up.’ Catch-up in these areas is very difficult. This government’s lack of vision is a distinct problem. The policy will look good on paper. It looks very glossy. All you have to do to see what I am talking about is grab a copy of the government’s latest industry policy. This in itself is a testament to this lack of vision. Basically it is just a glossy brochure. This is a government that has been in power for 11 years. The minister has been administering his department for quite a number of years and claims to have some sort of insight and vision as to where industry should be going. With all the resources of government and the billions of dollars it spends, the government has put together what could be classed as nothing more than a marketing 101 glossy brochure. It is very thin on policy and comprises solely of a political grab bag of things that may look good in an election year.

For me, it is just not good enough in this very important area of industry and innovation. The really important part is how we sustain our current standing in the world in terms of productivity and jobs growth. I do not think it is good enough for the government to just sit back and say, ‘Have a look at how low unemployment is; have a look at how good the economy is; have a look at the things we are doing.’ That is fine, but it is not good enough on its own. You really need to compare us to the rest of the world, which is having the same resources boom as we are. If you compare our economic position to that of the other nations that we compare ourselves to—our unemployment rate and all of those factors that we look at to determine that we have a good economy—then suddenly it does not look that good. Suddenly it does not look as if this government has actually been doing that great a job; it has just come along for the ride.

These things were going to happen anyway. With the Australian economy being supported by a once-in-a-lifetime resources boom, which is being generated out of Western Australia and Queensland, you can begin to understand where the innovation is, where industry is driving and where things are being done in the economy. The whole point is that that is not actually being driven by government. Yes, we do have a good economy and unemployment is low, but how much better could it be if the government were taking an active role? Wouldn’t it be better if unemployment were down to below four per cent, not just below five per cent? Wouldn’t it be better if our economy were actually producing more jobs? The government gloats about jobs—and I am pretty happy; I want everybody in my electorate to have a job—but if we compare our participation rates with those of other countries, particularly for older Australians and younger Australians, again we do not look so good.

So where are the policies from the government to address those issues? It is no good to just say: ‘We have done a good job. It’s all over. We can rest.’ There is no resting for government. We have to continue to be competitive and productive. We have to increase our capacity. If we do not do that, we start to fall behind. All the things that we enjoy today and all the capacity that we have today start to slip behind. The catch-up is the hard road. The link here with this bill and the catch-up is that, while these mechanical and technical changes are long overdue—and we support them—we need a bit more from government. We need more than technical changes, more than a glossy brochure on industry. The only thing I can divine out of their glossy brochure is that some sort of fix for Australian industry policy is the global supply chain. Apparently, that—contained in one sentence—defines everything this government is going to do. I believe there is a lot more we can do.

Labor have a vision. We have a plan. We have a lot of ideas. These ideas did not just come out this week or this year. They are things we have been talking about for many years. I can remember talking about productivity and innovation in industry years ago, when this government did not even know how to spell those words. These words, for government, have only just appeared. Finally, their polling told them, ‘Hey, this stuff is really biting in.’ Suddenly it is, ‘Hey this stuff is important to the community.’ The community is getting it, years after us. Sometimes you struggle on these policy issues and everybody says you have no policies, because the stuff we are talking about has not quite bitten in yet to the Textor polling and all the stuff that the government does, wasting taxpayers’ money. But when it does, finally we start to see some catch-up and a bit of money goes into these areas, which is always welcome.

It is clear that we need to support our scientific and research institutions. That is an integral part—you cannot separate this out—of industry policy and innovation policy. These are the drivers of our economy. These are the things that create the jobs. There is something that I like to remind people of when we talk about these issues. There seems to be a lot of concern in the community—and it is well-founded in a lot of areas—about our ability to compete with China. This is talked about literally every day in every workplace, in every home. The great fear is that we cannot compete against cheap labour rates. China can always build something cheaper than us; that is true. We will never beat them. We will never be able to work for the same pay rates—nor should we and nor do we want to. The problem is that that is the discussion from the government of yesterday. The discussion from government today is: how do we beat China on the innovation front? What the Chinese are doing, very cleverly, is not just competing on labour rates and their ability to make things cheaper; they are starting to innovate. They are starting to beat us at what we do best.

Australia is renowned around the world as innovators, as inventers and as entrepreneurs. But, if we do not start taking that seriously and supporting the people who build that, tomorrow the battle we will have will not be on China building something cheaper than us but on China out-inventing and out-innovating us. These are the challenges we will have tomorrow. That is what gives me real concern about the government’s vision—because there isn’t one. There is nothing in their policy today that addresses the problems we will face tomorrow and next week. The government are very happy to sit here and ride home on the good economic conditions that have been delivered to them but not by them. Let us remember that government do not create a resources boom; they just ride the resources boom. The resources boom is built by miners and by huge demand. It is built by China and India and other countries that have a huge thirst for our resources. These are the things that drive our economy. Make no mistake about that. No-one denies it. But, if we do not do something on top of that, if we do not start to skill our workforce, if we do not provide the policy and the funding and the resources to our technical institutions like TAFE, to our universities and to our science and research institutions and provide the mechanisms for innovators in this country, we are going to start falling behind—and it will not be on our pay rates. That is what concerns me.

What I want to see in this place coming from government are real policies, not just technical changes like those contained in this bill. I want to see real policies that deliver some real money and real programs. There is plenty of money out there—there is no question about that. We can see it in this budget. There is plenty of money left over, and there will be more money to come—don’t worry. The government is not just sitting on a $10 billion surplus; it is sitting on much, much more. Come the election, we will all know about that. Where the money should be going is on skilling the workforce, making the workforce more productive, providing for young people to access TAFE and providing our science research bodies and organisations like ANSTO, CSIRO and the marine institute with the ability to deliver on that. You cannot have one without the other. We need to focus on teaching, on quality research, on all those drivers—all those things we used to be the best at. Other people are not just sitting around watching us and saying, ‘These guys are the best at that.’ No—they are saying, ‘How do we beat these guys?’

How they beat us is simple. They spend more on R&D than we do. They support their innovators more than we do. I am sure that everybody will concur with me—they would have heard a story or know of somebody. I will not list them all today, but there have been plenty of great ideas and inventions based here in Australia that could not find any support—not government support, nor industry support, nor private support. The innovators go offshore and they literally make $1 million overnight and then sell it back to us. That is our biggest problem. That is our biggest challenge for tomorrow. This is what I do not find in government policy. I do not find the answers, the policy solutions. I do not find the funding basis to deal with those challenges of tomorrow.

I will round off by just saying a couple of things: it is great to see money going back into higher education from the government. It is a funny thing—$5 billion is a lot of money. It is an endowment. It is the sort of thing that people used to do privately. The Treasurer said it: more money is now given in one fell swoop, in one day, to the university sector in the form of endowments than was given for the past 150 years of endowment by private people feeling they had a need to support higher education and doing it themselves. It is a good thing. Universities will certainly appreciate it. I cannot see too many people giving in the future now the government has given them $5 billion. Perhaps they could make those endowments to CSIRO, who always need more funding and more support.

There is no money for clean coal technology from the government. They do not see that as important. The rest of the world thinks it is important. Labor thinks clean coal technology is important. Coal is our biggest export. Coal is one of the things that drives our economy and we are not doing anything about it. We are not innovating in coal. Other countries are innovating in coal because they can see the future. The future is tomorrow—and it is real; it is about productivity. Even France, where there is a 35-hour working week that they actually stick to, are more productive than we are. We work more than them. Why aren’t we doing something about the productivity of this nation and our ability to compete? We can compete in manufacturing. We can compete in coal. We can do more than just dig things out of the ground.

I commend this bill for the technical changes it makes but I give a very bad, negative mark to the government because they do nothing about tying together these three very important institutions or funding them in a real, significant way.

Pat Farmer (Macarthur, Liberal Party, Parliamentary Secretary to the Minister for Education, Science and Training) Share this | Link to this | Hansard source

I rise to conclude the debate on the Governance Review Implementation (Science Research Agencies) Bill 2007. I thank the members for Ballarat and Oxley for speaking in the second reading debate and for their support of the Howard government’s introduction of the bill. I would also like to make special mention of the member for Bass and his very learned contribution to this bill. I know the people of Tasmania appreciate his support for this bill and the work he does in this place.

The bill makes relatively minor amendments to the Australian Institute of Marine Science Act 1972, the Australian Nuclear Science and Technology Organisation Act 1987 and the Science and Industry Research Act 1949. The amendments implement changes to the governance arrangements of the Australian Institute of Marine Science, better known as AIMS; the Australian Nuclear Science and Technology Organisation, known to all of us as ANSTO; and the Commonwealth Science and Industrial Research Organisation, which is the CSIRO. The bill is part of a broader exercise within the Australian government to improve transparency and consistency in relation to governance arrangements for statutory authorities and office holders, further to the government’s endorsement of the recommendations of the Review of the corporate governance of statutory authorities and office holders, better known to all of us here and to the wider sector as the Uhrig review.

AIMS, ANSTO and CSIRO were assessed in detail against the recommendations of the Uhrig review. The assessments indicated that the agencies’ current governance was largely consistent with the Uhrig board template. The government concluded that the governance of each agency should continue in accordance with that template but determined that a number of minor changes would enhance the government’s arrangements for these agencies and better align them with the board template.

The most significant amendments include removing the requirement for ministerial approval of contracts above a prescribed value for each of the agencies. This is consistent with the Uhrig review’s recommendation that the boards should have a wide power to act. Accountability will be maintained by requiring each agency—as in the Minister for Education, Science and Training’s statement of expectations—to notify the minister in advance of the agency entering into significant contracts. This is also consistent with the provisions of section 15 of the Commonwealth Authorities and Companies Act 1997. The Uhrig review recommended that a board should have wide power to act. This includes the powers to appoint and terminate the appointment of the CEO and to monitor and assess his or her performance. Accordingly, the bill includes amendments that will enable the AIMS council and the CSIRO board to appoint or terminate the appointment of their CEO. The ANSTO board already has this power. The bill also contains amendments that will provide the AIMS council and the ANSTO and CSIRO boards with additional discretion to terminate the appointment of their CEO if satisfied that his or her performance has been unsatisfactory for a significant period.

A position of deputy chairperson for CSIRO will be created. This is in recognition of the responsibilities and the workload of the chairperson of the CSIRO board. It is consistent with the arrangements that already apply to ANSTO and to many other large statutory bodies. The remuneration for the deputy chairperson will be set by the Remuneration Tribunal. The cost will be met out of the CSIRO’s existing budget and therefore will have no financial impact. Membership of the board of ANSTO will also be set at between six and nine members. This increase in the size of the board will enable a wide range of expertise to be brought to bear on corporate governance of ANSTO and is commensurate with the extent of technical complexity of its operations.

In conclusion, I would like to emphasise that the changes to the agencies’ governance arrangements do not reduce their accountability. While the amendments provide greater freedom for the agencies’ governing boards or councils to act, as recommended by the Uhrig report, there are still requirements for each agency in the enabling legislation and in the Commonwealth Authorities and Companies Act 1997 which ensure an appropriate level of accountability. In addition, the statement of expectation for each agency will require the agency to keep the minister fully informed of significant events and to consult with her on significant matters.

The amendments reflect the recommendations of the Uhrig review and align each agency’s governance arrangements with current best practice. This will ensure that the administration of the recently announced government funding for AIMS, ANSTO and CSIRO for the next quadrennium, their largest research budgets ever, will be efficient, effective and accountable.

I commend the Governance Review Implementation (Science Research Agencies) Bill 2007 to the House.

Bill read a second time.