Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

) ( ): by leave—I move opposition amendments (1) to (3):

That all words after "That" be omitted with a view to substituting the following words:

"the House notes with approval that, in response to public pressure, the government has introduced this limited bill, but deplores the government's failure to:

(1) establish an independent Registered Organisations Commission to:

(a) enforce, and police the reporting and compliance obligations;

(b) provide information to members of registered organisations about their rights and act as the body to receive complaints from their members;

(c) educate registered organisations about the new obligations that apply to them; and

(d) absorb the role of registered organisations enforcer and investigator, currently held by the General Manager of Fair Work Australia;

(2) ensure registered organisations face the same accountability and transparency measures as required of companies and their directors under the Corporations Act; and

(3) ensure registered organisations face the same penalties as companies and their directors under the Corporations Act."

I make the point that the minister at the table talks about registered organisations being fair and accountable, but we in the coalition do not believe that this legislation makes them sufficiently accountable. I flagged in my speech in the second reading that the coalition would move at the consideration in detail stage commonsense amendments to make some improvements to this bill, separate from our amendments which were moved at the second reading stage.

With respect to this group of amendments, the bill as drafted allows for Fair Work Australia to outsource fully an investigation to an outside body. The coalition believes that, while outside experts may be required on individual parts of an investigation, the independent statutory body should be the one to conduct and oversee the entire investigation. We have concerns that investigations being conducted by an outside entity the general manager sees fit would not allow for the proper accountability and oversight of investigations. So the coalition will move an amendment to ensure that investigations are actually conducted by Fair Work Australia, while leaving in the power for outside help to be brought in on individual parts of an investigation. In this way a full investigation of itself cannot be outsourced.

We will seek to bring across into the Registered Organisations Act section 184 of the Corporations Act, which would make it a criminal offence for bosses of registered organisations to not act in good faith, to use their position dishonestly or to behave in a reckless manner. Further, with the government's increases to the civil penalties the coalition will seek to increase penalties in line with the Corporations Act.

The coalition does not believe that the amendment that the government moves about disclosure of information to police is necessary because Fair Work Australia should at all times have the ability to cooperate fully with police as per advice published earlier this year by Stuart Wood SC. However, our amendment will make it abundantly clear that the general manager and staff of Fair Work Australia can cooperate fully with police at all stages of an investigation, including proactively providing information to police. As I said, we do not really believe we should need to make this amendment but we do so for the avoidance of doubt. The government's amendment in this area just does not go far enough to ensure that this cooperation will take place.

While Fair Work Australia presently can provide information to the Commonwealth Director of Public Prosecutions, the government will allow a further disclosure to all directors of public prosecutions in Australia. However, we witnessed in Fair Work Australia's last referral an inability of the Commonwealth Director of Public Prosecutions to pursue the matters raised as they were not prepared in a brief of evidence. Fair Work Australia said that it could not prepare a brief of evidence because the legislation did not allow for it. This amendment will give Fair Work Australia the express power to prepare a brief of evidence should it need to.

The government will require the publishing of information to members, including the pay, interests and expenses of senior officers. The coalition seeks to amend this provision so that the report to members, however it is provided, is also provided to Fair Work Australia within their existing reporting requirements. The coalition believes it is important that the information is provided to Fair Work Australia to ensure that regulatory oversight on how union members' money is spent is absolutely spot-on and accountable.

The coalition feels that these amendments will only improve the bill. The only way to get the best possible outcome is for the next coalition government to implement our better plan for accountability and transparency of registered organisations, because only a coalition government can restore the hope, reward and opportunity that is so horribly missing under Labor's framework.

I have spoken to a group of eight amendments. For the convenience of the House I have included my comments on all of those amendments but I am actually asking that amendments (1) to (3), as circulated in my name, be considered at this point of time.

Bill Shorten (Maribyrnong, Australian Labor Party, Minister for Financial Services and Superannuation) Share this | Link to this | Hansard source

For the sake of efficiency, I might deal with all of the amendments in my comments and then deal with them separately, seeing as the member for Farrer has spoken to all of them. At least, I will try to cover as much ground as I can in the five minutes.

In reference to the coalition amendments (1) through to (3), there are already requirements in the legislation for officers to act with care and diligence, to act in good faith, and not to use their position improperly or use information that they have obtained through acting as an officer of an organisation improperly. The Fair Work (Registered Organisations) Act already prohibits members' money being used to favour particular candidates in internal elections or campaigns, and our proposal does triple penalties for breaches of the registered organisations act.

So let us be clear: the government does not condone officers of registered organisations or officers of corporations, or anyone in a position of trust or fiduciary duty, acting inappropriately, misusing funds that they are entrusted to manage or taking benefits they are not entitled to. There is nothing in the registered organisations act that prevents criminal proceedings being initiated where funds are stolen or someone engages in fraud. The registered organisations act prioritises the conclusion of criminal proceedings before civil penalties are issued in relation to the same conduct—that is in sections 311 and 312. Indeed, the registered organisations act does not prevent criminal proceedings from being commenced even after civil penalties have been applied in relation to the same conduct.

The argument that has been proposed to base these amendments upon is that registered organisations are identical to corporations. They simply are not. Registered organisations are not regulated by the Corporations Act, and this is appropriate. At no time, even in the Howard years, did the coalition government or any of its ministers ever propose saying that registered organisations are identical to corporations—clearly, a change in policy now. Some in this debate have argued that the Corporations Act regulations should be applied to registered organisations. Others have argued that penalties should be increased 100-fold. We believe that this argument is too negative and too simplistic. We do believe that officers of organisations, like those in corporations, are subject to serious duties and obligations. They must exercise care and diligence. They must act in good faith. They must not improperly use their position. We recognise that the financial regulation of these entities is similar. They are required to undertake regular reporting of the financial accounts. Auditors are required to sign off their books in accordance with accounting standards. They are subject to regulatory oversight. And the general powers of Fair Work Australia are similar to those of ASIC. In addition, this bill uses Corporations Law concepts like related party transactions.

We must also recognise that registered organisations and corporations are different creatures, both in practice and in law. The aims of the two entities are different. It is a false debate to say that unions or employer associations are identical to corporations. That has never been in the jurisprudence of this nation, and the case has not been made to change that policy in that way. If you accept what the opposition says, that unions and employer associations should be treated identically to corporations, then why stop there? Do you argue that St Vincent de Paul, who hold significant financial interests, should have the same laws apply to them as apply to BHP Billiton? Should Telstra be regulated in the same way as the toy makers union? Should Coles have the same rules apply as an unincorporated partnership running a bookshop?

We do not believe that the case for these amendments has been made. We believe that the hazards which the opposition are concerned about are adequately catered for in the propositions that are being advanced.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

The question is that opposition amendments (1) to (3) be agreed to.

The House divided. [18:05]

(The Deputy Speaker—Ms AE Burke)

Question negatived.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

by leave—I move opposition amendments (4) and (7) together:

(4) Schedule 1, item 15, page 7 (lines 1 to 15), omit section 335C.

(7) Schedule 1, page 14 (after line 10), at the end of Part 1, add:

39A After section 343A

Insert:

343B Disclosure of information

(1) This section applies to information acquired in the performance of functions or exercise of powers under this Act.

Disclosure that is necessary or appropriate, or likely to assist administration or enforcement

(2) The General Manager may disclose, or authorise the disclosure of, the information if the General Manager reasonably believes:

(a) that it is necessary or appropriate to do so in the course of performing functions, or exercising powers, under this Act; or

(b) that the disclosure is likely to assist in the administration or enforcement of a law of the Commonwealth, a State or a Territory.

Obligation to disclose information relevant to commission of offence

(3) If a member of the staff of FWA reasonably believes that the information is relevant to the commission, or possible commission, of an offence against a law of the Commonwealth, a State or a Territory, the member of staff must disclose the information to the General Manager.

(4) If the General Manager reasonably believes that the information is relevant to the commission, or possible commission, of an offence against a law of the Commonwealth, a State or a Territory, the General Manager must disclose, or authorise the disclosure of, the information:

(a) for an offence against a law of the Commonwealth—to the Australian Federal Police; or

(b) for an offence against a law of a State or Territory—to the police force of the State or Territory.

Information may be disclosed despite inquiry or investigation under this Act

(5) To avoid doubt, if the information relates to a matter that is the subject of an inquiry or investigation under Part 4 of Chapter 11, a person need not wait until the conclusion of the inquiry or investigation before disclosing, or authorising the disclosure of, the information under subsection (2), (3) or (4) of this section.

39B Application—disclosure of information

The amendment made by item 39A applies in relation to information acquired before, on or after the commencement of that item.

The House divided. [18:12]

(The Deputy Speaker—Ms AE Burke)

Question negatived.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

I move opposition amendment (5):

(5) Schedule 1, page 8 (after line 18), after item 23, insert:

23A At the end of section 336

Insert:

Referral to include relevant evidence and information

(6) If the General Manager refers the matter to the Director of Public Prosecutions, the Australian Federal Police or the police force of a State or Territory, the referral must include all the relevant evidence and information that has been acquired in the performance of functions or exercise of powers under this Act.

(7) The evidence and information must be given in such a form as to enable it to be used to consider whether to institute a prosecution, or take any other action, in relation to the matter.

Note:   The evidence and information should be set out in the same way as a brief of evidence, or in a way that facilitates converting it to a brief of evidence.

Question negatived.

I move opposition amendment (6):

(6) Schedule 1, item 36, page 11 (line 25) to page 12 (line 9), omit all the words from and including "delegated to", substitute "delegated to a member of the staff of FWA who is an SES employee or and acting SES employee".

Question negatived.

I move opposition amendment (8):

(8) Schedule 1, page 29 (after line 6), at the end of the Schedule, add:

62 After paragraph 230(1)(c)

Insert:

(ca) records of all disclosures made in accordance with rules required by Division 3A of Part 2 of Chapter 5 (rules relating to disclosures);

63 Paragraph 233(1)(b)

After "(c)", insert ", (ca)".

64 Subsection 233(2)

After "(c)", insert ", (ca)".

Question negatived.

Bill agreed to.