Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

Earlier in the debate on this bill, the Australian Securities and Investments Commission Amendment (Corporations and Markets Advisory Committee Abolition) Bill 2014, I was reflecting on the great work that CAMAC has done, particularly in trying to work out a framework for the introduction of crowdsourced equity funding in Australia, and what that might do to help support businesses, particularly start-ups and those that are at the early stage of innovation, being able to get access to much-needed capital. As I indicated earlier, CAMAC brought down a very comprehensive report in May. I would like to congratulate the subcommittee of CAMAC who brought that report down, led by chair, Greg Vickery AO, from Norton Rose Australia; along with Teresa Handicott from Corrs Chambers Westgarth; Professor Ian Ramsay, who is a professor of commercial law at the University of Melbourne; and Brian Salter, who is the General Counsel at AMP; and they were assisted by ASIC's Maan Beydoun. Even in mentioning those names, you get a sense of the calibre of people who have committed to assist in CAMAC's work. As I indicated in my earlier contribution, from a policy perspective it is simply a tragedy that with the abolition of CAMAC we will lose those skills and that expertise, and the acquisition of the insights of that body—and it is assumed that, once CAMAC is demolished in the way that is proposed, the three people currently working for CAMAC will be absorbed by Treasury. It is an absolute tragedy that the government will have to pay more to get that expertise, as opposed to what they had at hand and the great work CAMAC has done, such as this report.

This report on crowdsource equity funding was widely welcomed by many for its breadth. It looked at jurisdictions—particularly in the US, the UK, New Zealand, Canada and within the EU—that are working very hard to put, or have put, in place mechanisms to allow crowdsource equity funding. Not everyone would necessarily agree with what CAMAC put forward, but CAMAC was quite good in saying, 'This is where we believe the work has been scoped out of what should be done on crowdsource equity funding.' It said it was up to government then to advance things if it wanted to make alterations and recommendations on where to next. Certainly from the opposition's perspective we have done just that: we released a position paper in December that outlined a number of principles that should be adhered to or taken into account when putting together a framework for crowdsource equity funding These principles include: that we build recognition and support by government, business and the broader community that crowdsource equity funding is a desirable means of raising capital to drive innovation; that we should have investor and consumer safeguards in place and acknowledge that there is a great potential for investment return, balanced with a greater degree of risk; that freeing up the access of start-ups to crowdsource funding by loosening some of the regulatory measures proposed, including the requirement of the exempted public company status. We put that forward for discussion. Another couple of our principles are that legislation be developed to support the introduction of this mechanism is given a high priority—we have expressed our concern that it has been delayed; and that a light regulatory touch be put in place. We hope that the government gets on with the crowdsource equity funding legislation. We also believe it is wrong to get rid of CAMAC.

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

I welcome this opportunity to speak this afternoon on the Australian Securities and Investments Commission Amendment (Corporations and Markets Advisory Committee Abolition) Bill 2014. As previous speakers have said and as the name suggests, the purpose of the amendment is to discontinue the operations of CAMAC, along with its legal committee, which was initially set up in 1991. The bill proposes that the operations and functions of CAMAC cease within 28 days of royal assent. Through this bill, the government is in a small but important way fulfilling two key commitments that we made prior to the election. The first was getting the budget back in order and paying back Labor's monstrous debt; the second was seeking to provide a more streamlined, lean and efficient government.

I have some sympathy for aspects of the complaints of members opposite, but from their chorus of complaints one is that this is a saving of only $2.8 million to the budget and is therefore completely unnecessary. It was ultimately that kind of thinking that put us on a trajectory of $667 billion of debt—that each million dollars did not matter. We have taken the view in reviewing the operations of government that, to be lean and to operate as small a government as we possibly can, we must look everywhere for savings. CAMAC is part of that and so the $2.8 million of savings over the forward estimates with the abolition of CAMAC is important. The two aims of getting the budget back under control and striving for ever leaner government are interconnected aims. We on this side of the House know that in order to repair the budget a lot of work has to be done and no amount of obfuscation by members opposite will make it go away—and it cannot be wished away.

It is quite opportunistic for those opposite to wish it all away and pretend there is no problem. But there is a problem. It is salient to remember the key facts. If we had completely unrestrained ability to generate revenue, then government's decisions might be different, but at the moment we are borrowing over $1 billion each and every month just to pay back the debt left by Labor. That is $1 billion each month rising to $3 billion, if debt is not restrained in the future. The scary thing is that we are paying at $1 billion of interest a month now with record low interest rates and record low debt rates for government accessing debt. If, as I suspect, interest rates rise in the not too distant future, it is scary to think what the debt and interest burdens Australian taxpayers will have to bear. Every dollar of interest that we pay to a foreign lender is a dollar less that goes to a school or a hospital. I would caution members opposite from scoffing at the savings come out of this bill—the $2.8 million of savings over the forward estimates. Sure, it is not sheep stations, but we have to look at every area of government and we have to make tough decisions between competing objectives.

Some economists have forecast—I read in the paper on the weekend—that within a few decades' time government debt in Australia will be 50 per cent of the economy and could rise to over 100 per cent of our annual GDP. Again, the thinking of members opposite is that we can ignore these problems and not tackle them with quite sensible and small measures like the abolition of CAMAC, but I would caution them against that. The bill before us today fulfils a commitment made as part of the budget process. I have alluded to that $2.8 million of savings over the forward estimates and, while this figure is a small stand-alone figure, ceasing the operations of small bodies and committees such as CAMAC generate savings beyond the annual appropriation. As we all see from our committee work and all of the oversight that goes into bodies such as this, the ongoing operation of small agencies like CAMAC absorbs resources across the wider Commonwealth public service, and the oversight and administrative costs are obviously on top of the direct appropriation of $2.8 million. So the savings are somewhat larger than that.

But when these cost savings are multiplied across the federal government in its entirety, we are talking about a big number. One of the scary things that we realised when we came into government was that we asked the bureaucrats, 'Please give us a list of every committee and every body that the federal government funds or administers in some way.' We could not get that list. We could not get a definitive list of every single committee or body that is funded by the Commonwealth government. If that does not tell you that we need to put a ruler over bodies such as CAMAC, then I do not know what does. Again, I think this is a very sensible change. The decision to abolish CAMAC, along with a number of other government bodies in that big list that no-one could actually give us, also fulfils the second commitment that I alluded to earlier: to deliver a leaner, more efficient government sector. The abolition of government bodies like CAMAC will improve coordination and accountability, reduce the costs associated with separate governance arrangements, and increase inefficiency in how public funds are utilised.

It is always going to be pretty tough to walk into this chamber and try and convince the Australian Labor Party that we should have a smaller, leaner government. Because ingrained in their DNA is bigger bureaucracies, bigger governments, that government funding of any body is preferable to allowing private enterprise or private experts to provide the type of service that CAMAC has provided. I think that in the comments of members opposite today that ingrained ideology has come through, in saying that government will not be able to source the kind of advice provided by CAMAC in any other way. That also impugns every private sector individual involved with CAMAC. For people involved in business, professional bodies—legal, accounting—they will continue to provide independent advice to government. If we cannot consult with the private sector, presumably those opposite are arguing that we should set up bodies in every conceivable field of public policy and get advice from them, because there is no point in consulting with private enterprise, industry bodies, the Law Council or any of the other professional bodies. That does not meet any test of scrutiny.

As members of our government are aware, we are proud of the fact that we have removed thousands of pages of regulation and slashed more than $2 billion in business regulatory compliance costs. I know those opposite are sick of hearing that, but that is something that we are very proud of, as being a huge achievement in the first year of government. It ultimately allows business to spend less time and money dealing with regulation and more on creating new jobs. So our smaller and more rational government reforms, of which this bill is a part, form a key component of our important deregulatory agenda.

As former speakers have said, CAMAC was established for reforming and renaming previously existing bodies with the purpose of providing advice to the government on matters relating to the reform of corporations and other financial and securities related legislation. This was part of an effort to bring about a national framework for corporations and securities regulations in the 1980s.

CAMAC and its predecessors provided the Commonwealth with an independent group of corporate experts who could provide advice on the progress of the implementation of the newly unified laws in this area. The body also sought to provide an avenue for the industry to voice its views and concerns on any proposed changes or reforms seen as desirable in the area of corporations and financial law. So for the reasons I have outlined earlier, we do not believe the case is justifiable to have a taxpayer funded committee of this nature, due to the availability of other more important bodies who already provide a role in performing this function.

Whilst we recognise the important contribution that CAMAC has had over the years to law reform in these areas, this bill recognises that the business and economic environment has changed since the agency was first established in 1991. As I have said earlier to members opposite, we are fully confident in the professionalism and capability of business and industry groups to make their case to government without the need for additional bureaucracy. The abolition of CAMAC will not prevent or hinder the ability of business, the business community, experts, those people who are engaged in professional bodies, whether they be lawyers, accountants, bankers or others, to advise government in good faith what they believe is in the best interests of that policy area.

With the passage of this bill, the government will also continue to seek independent, high-quality advice when necessary, ensuring that advice provided is practical and evidence based through utilising specialist, relevant expertise, such as has already happened, whether that be through panels or other appointees and industry experts.

After the abolition of this body, the Treasury's Markets Group, as other members have also highlighted earlier, will continue to advise the government on matters of corporate law, financial markets and financial services. This advice will continue to be informed by regular engagement with the broader industry and relevant experts in the field. Further, ASIC will retain the ability to provide advice to the government of the day, whoever that may be, on matters associated with amendment or law reform in these areas. It already happens. None of ASIC's functions will be altered as a result of this bill.

Of course, the government will also be able to refer matters to the Productivity Commission as well as the Australian Law Reform Commission to assist in any work that is required. Both of these bodies have previously completed reviews on matters such as the regulatory burden on business, insolvency law and, relatively recently, managed investment schemes. So I and the government believe that, when all of that is taken into account, this is a sensible bill given the changing economic circumstances and that it fulfils, as I said, two of the government's key aims—and that is leaner, more efficient government with less red tape and also providing reasonable savings to the budget.

In the case of CAMAC, the evidence is apparent to me that there are numerous other government agencies that will be more than capable of performing the tasks that CAMAC now performs and, therefore, I see this as an absolutely sensible bill which fulfils a commitment we made at the time of the budget. I therefore commend the bill to the House.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

This is a classic example of this government getting rid of what is a very efficient and effective body in a move that will end up costing Australian taxpayers much more money. The Corporations and Markets Advisory Committee advises ASIC and costs $1 million a year. It has three staff and costs $1 million a year. That is it. Yet, the Abbott government is abolishing it and the result will be that the work that was performed by CAMAC for $1 million a year will now be contracted out to private organisations to undertake. There is no doubt at all that those organisations will charge much more than $1 million for the reports that they prepare for the government over many years to come in respect of corporations and market advice. So here we have another example of the great rhetoric of the Abbott government, saying that they are reducing regulation and saving taxpayers' money, when in actual fact this bill will cost Australian taxpayers much more.

Since 1984 the Commonwealth has had an independent research based reform body focused on corporations and financial markets. Since its inception, CAMAC has delivered sound, balanced, well-researched and market oriented law reform proposals. It has been widely acknowledged that CAMAC's role and advice has provided invaluable guidance to multiple governments on subjects from managed investment schemes to shareholder claims against insolvent companies and corporate voluntary administration.

For its work CAMAC has received high praise from key interest groups and commentators such as the editor of the Australian Journal of Corporate Law, Professor Neil Andrews, who described CAMAC's expertise as:

… unmatched in the technical details of corporate and securities law and in sustaining the manners gentle style of Australian business regulation.

The Governance Institute of Australia, too, had very positive things to say about CAMAC. They said it is:

… a lean, efficient and highly-regarded organisation that has improved our corporate institutions over the past two decades and continues to have a vital role to play in the decades ahead.

But recognition of the good work CAMAC has done over the years has not just emanated from key stakeholders and commentators; the Abbott government, too, has expressed its appreciation for the committee. In its industry innovation and competitiveness agenda document of last October, the government praised CAMAC's study of crowd sourced equity funding, describing the committee as 'a government advisory body with strong financial market experience'.

Unfortunately, as has become clear on many topics, this government thinks it knows better than the experts and has decided to press on with scrapping this eminent committee which, as Judith Fox from the Governance Institute of Australia says:

… punches well above its weight and delivers economic benefits that greatly outweigh its funding costs …

'Economic benefits that greatly outweigh funding costs' is the best way to describe CAMAC in one sentence.

Let's look at that for a moment. CAMAC is supported by three staff and costs $1 million a year. That is it—$1 million. But this government wants to close the book on the committee that has advised on almost every chapter in modern Australian corporate history, a decision that simply beggars belief from a supposedly pro-business government. This disastrous bill is proof the government has firmly planted its fingers in its ears as it pursues its bloody-minded ideological agenda. The shadow Treasurer hit the nail on the head when he said:

I can only assume the government, in its ideological drive to abolish organisations, just didn't look at what CAMAC does.

It would not surprise me if the minister who introduced this bill has no idea about the work of CAMAC.

The irony of this bill has not gone unnoticed. Speaking to The Sydney Morning Herald in June 2014, a longstanding member of CAMAC, Professor Ian Ramsay of the University of Melbourne law school, agreed that the government's decision to abolish the committee ran counter to its supposed commitment to business in Australia. He said:

It cuts directly against the government's own philosophy and position about facilitating business.

One of the great strengths of CAMAC is its independence. Members are appointed on the basis of their knowledge and experience in business, finance and law not on favour with the particular government of the day.

Unfortunately, CAMAC's absorption into Treasury, a government department that is charged with implementing government policy, threatens that independence. This outcome has been of concern to many stakeholders. In June 2014 the chief executive of the Governance Institute of Australia, Tim Sheehy, lamented the loss of this independence, citing research into the struggling annual general meeting which had been removed from CAMAC and handed to Treasury—research that still remains outstanding. This removal of independence, however, is hardly surprising given the government's aversion to independent advice.

You only need look at what happened in estimates last week and the approach that this government has taken in reaction to the Australian Human Rights Commission's recent report into children in detention to see that this government does not like independent, expert advice. They do not like independent, expert advice that is critical of its policies. What is their approach? In this case, on markets advisory and corporations, it is to shut the body down, even though it only costs $1 million a year. That function will be absorbed into Treasury. What is the approach that Treasury will take when it comes to getting expert, independent advice on matters to deal with law reform in this area? They will contract it out to the private sector at a cost of millions of dollars. We have all seen these reports before. They come up in estimates when governments ask private organisations to undertake research and independent reports on their behalf, and the costs of those are sometimes astronomical. They are well into the multiple millions of dollars. Yet, they are going to get rid of a body that only costs $1 million to administer, with three staff; a body that is generally lauded throughout the community, and provides expert advice on markets and corporations.

Duplication is another excuse that the government has given for the abolition of the committee, and again doubt has been cast as to what duplication, if any, this bill will resolve. In fact, a number of submissions to Treasury questioned this justification. In its submission, the Australian Institute of Company Directors expressed its misgivings, stating:

… we are of the view that dismantling CAMAC is contrary to the Government's own objectives as set out in the Smaller andMore Rational Government reforms … CAMAC epitomizes the high quality, effective and cost conscious approach the Government is trying to achieve.

Labor opposes this bill for the simple fact that there is no efficiency gain. The abolition of a highly regarded committee will have a detrimental impact on the quality of advice being received by this government and, ultimately, the quality of law reform that is undertaken in the corporations and financial services space by this government, and by governments of the future.

What has been made abundantly clear by this government, lurching from policy failure to captain's picks to captain's call, is that it can ill-afford to dispense with high-quality independent advice for a very, very efficient and cost effective means. That is what CAMAC has provided—a million dollars to operate on an annual basis, but the value to government in terms of its independent advice, on law reform concerning corporations and financial markets has been exponentially greater than the million dollar cost for which it is run. Once again, this is an example of this government cutting off its nose to spite its face. This will cost Australian taxpayers more. It will ensure that private organisations get contracts that will cost Australian taxpayers multiple millions of dollars, all because of this government's misguided approach to reducing regulation and, apparently, being pro-business.

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

I rise to oppose the Australian Securities and Investments Commission Amendment (Corporations and Markets Advisory Committee Abolition) Bill 2014. Labor opposes the abolition of the Corporations and Markets Advisory Committee for some very important reasons. Why would a government that purports to be pro-business abolish CAMAC? That is the question that must be on everyone's mind.

CAMAC has long enjoyed bipartisan support, and has provided support and advice to governments of both political persuasions. There has been an independent-based reform body for corporations and financial markets since 1978, starting with the Companies and Securities Law Review Committee, and followed by the Companies and Securities Advisory Committee, in 1989, which became CAMAC, in 2002. The event that precipitated CAMAC coming into existence you will recall, Mr Deputy Speaker, was the High Court decision in Re Wakim, which caused a rethink of all of the cooperative corporations law regulation and the way in which the Commonwealth would have the power to ensure that there was cooperative and consistent corporations legislation across the nation. The states, of course, referred their corporations powers to the Commonwealth to allow for that to occur on the heels of that decision.

As the Law Council of Australia's Business Law Section points out, part of the national compact, and part of the deal under which the states agree to refer their corporations law regulation powers to the Commonwealth is that the states, among other things, get to have input into the selection of members for CAMAC. The states recognise that, in referring those powers—and it is a significant decision to refer, of course—the need for ongoing, constructive, independent, disinterested, expert advice to the Commonwealth on ongoing corporations law reform.

Mr Deputy Speaker, as you know, corporations form part of the economic fabric of our society. The way that corporations and markets run affects every household in Australia. It is a fact that if corporations and markets are run in a way that is poor or inappropriate, then that has real consequences for the people around the kitchen tables in Australian households. It has real consequences for families and individuals. So, there has long been a strongly held view that we need to have ongoing review and reform of corporations law in this country. We have seen the consequences of that through the work that has been done by CAMAC, amongst other organisations.

CAMAC has produced dozens of reports. There are some that would be very familiar to members in this place: reports in respect of continuous disclosure obligations, an issue with which I am obviously very interested, because of the consumer and shareholder protection aspects of continuous disclosure; company restructuring to avoid liquidation; executive remuneration and directors' liability.

In asking ourselves why a government that likes to hold itself out as being pro business would want to abolish CAMAC, we have to remember that CAMAC is such a highly regarded organisation because it has such integration in the business and professional community. Practitioners are involved in CAMAC. Appointments are made by the minister, following consultation with the states and territories, and made on the basis of people's knowledge of or experience in business, the administration of companies, the financial markets, financial products and financial services, law, economics or accounting. The chairperson of ASIC is also a member of CAMAC. So it is clear that the persons involved in CAMAC are very well placed to provide—from a practitioner perspective, from an expert perspective and from a disinterested, independent perspective—strong and rigorous advice to governments about corporations regulation.

So to me it seems odd that, even this government, as unpredictable and irrational as it can sometimes be, would move to abolish CAMAC. But, if you look at the Law Council of Australia's Business Law Section submission, which repeats a number of the arguments made to that organisation by Senator Cormann, two of those arguments are particularly revealing—firstly, that the government can source independent advice from Treasury and regulators; and, secondly, that business does not need a taxpayer funded body through which to express itself, that business is able to express its own views without that.

Those two things are revealing for a couple of reasons. Advice from Treasury and regulators is deeply important, but it is different from and complementary to the type of advice that can be provided by practitioners and experts who have been engaged in corporations and markets throughout their professional lives. They are different sources of advice, and one does not replace the other. More concerning is the idea that somehow CAMAC is just there to push a business barrow. CAMAC is a disinterested committee that acts in the national interest. Businesses—and this point is made by the Law Council of Australia in its submission—are perfectly able to make their own arguments from a lobbying perspective, from an advocacy perspective, to promote their commercial interests. But CAMAC serves a different role; it serves the national interest and the public interest in appropriate and ongoing reform of the law in so far as it relates to corporations and markets.

Those are some of the points made by submitters—and it is very difficult to find submitters who are in favour of abolishing CAMAC. The Australian Institute of Company Directors, an organisation of which I am a former member, expressed dismay in their 24 October submission. They said:

The Australian Institute of Company Directors …is dismayed that the Federal Government has expressed an intention to continue with the abolition of … CAMAC …

And why wouldn't they be? The submission went on:

Company Directors strongly opposes the abolition of CAMAC and we recommend that the proposed abolition not proceed.

They say that, though the government is seeking 'to remove inefficient and complex structures':

CAMAC epitomizes the high quality, effective and cost conscious approach the Government is trying to achieve.

In other words, in abolishing CAMAC, the government is achieving the very opposite of its stated aims. AICD say:

As the Government tries to reduce red tape, we are of the view that the Government's decision to dismantle CAMAC is likely to increase red tape in the long term. This is because there will no longer be a cost effective, highly experienced and independent body considering improvements to the corporate law in Australia.

Therein lies part of the problem with this bill, because, although it has been couched in terms of red-tape reduction and savings, it will have the opposite effect on both counts. It is a point that ought not be lost on members opposite. As the Australian Restructuring Insolvency & Turnaround Association said in their submission:

For an operating cost of less than $1 million per annum since 1998, CAMAC has delivered sophisticated and important advice and reports to policy makers and industry. Indeed, CAMAC's work continues to be instructive for much of the work we do.

Of course, any organisation and its members that deal with insolvency with a view to keeping businesses in operation and getting businesses out of financial trouble so that they can continue to contribute to the economy and provide employment is going to have something to say about the decision to abolish an expert body of the nature of CAMAC. As ARITA pointed out, there have been a number of valuable reports by CAMAC, such as Managed investment schemes, Guidance for directors, Members' schemes of arrangement and others that have gone directly to that issue of companies that are in trouble. They went on to say of CAMAC:

… it was the epitome of efficient government, with deep connections into industry.

They also said:

… we think it is counter-intuitive for Government to pursue the abolition of CAMAC in the name of more efficient government. CAMAC has delivered real value to the efficient and robust operation of corporations, financial markets and the economy as a whole and we urge the Government to reconsider its position.

As the House has heard, the Chief Executive of the Governance Institute of Australia was also very critical of the decision to abolish CAMAC. One of the great strengths that he pointed out in their submission is CAMAC's ability to engage with stakeholders, fulfilling an important role. He said:

CAMAC is respected by all stakeholders for the quality of its in-depth research and stakeholder consultation. Stakeholders also view the independence of CAMAC as a great strength. Governance Institute is of the view that such independence cannot be transferred to a government agency charged with implementing government policy.

He lists as three examples of the value of CAMAC the recommendations on related party financial transactions in respect of conflicts of interest; the introduction of a statutory derivative action that removed obstacles to shareholders in bringing litigation, which is important in ensuring that shareholders maintain appropriate levels of power within companies and can hold directors and companies to account; and enhancements to the requirement that directors and senior executives of a listed entity disclose any trading by them in the securities of that listed entity, meaning that trading by directors did not undermine market fairness and efficiency. He said:

All of these reforms have greatly strengthened corporate governance in this country.

Just those three examples underscore the value of CAMAC and really serve to reinforce the short-sightedness of the decision to abolish it. The suggestion that saving under $1 million a year is what is of paramount importance here is the government making the usual mistake that it makes of confusing saving in the short term with value in the long term. The question is not just, 'What is the cost?' but, 'What is the benefit?' What is the benefit? What is the return on the investment? That is the real question, not, 'What is the saving in the short term?'

There are so many submissions from serious and respected organisations expressing dismay at the government's decision to abolish CAMAC. If those submissions are accepted—and why shouldn't they be?—the government is likely to find that this so-called reform will cost more money than it saves and will lead to more problems and more red tape, as the AICD pointed out.

I mentioned the submission from the Law Council of Australia, which strongly objected to winding up CAMAC, as the government knows. The submission said that the Law Council of Australia wished to draw the attention of the minister:

… to the importance of maintaining confidence in the national system of corporate and securities market regulation, underpinned by referral of powers by the States to the Commonwealth, in which CAMAC plays a vital role;

That consideration ought to be taken into account as a very serious consideration, because a serious concern along with the integrity of the regulation of corporations in this country is whether people have confidence that corporations are operating appropriately and that the law is keeping up with changes in the market. The Law Council made the point:

… the Government would have no significant grounds for doubting the excellent contribution that CAMAC has made to the cause of sound corporate and market law reform.

They said:

That is no doubt a result of the combination of the quality of the full-time lawyers engaged by CAMAC, and the practical and expert business and legal input systematically achieved both through CAMAC's committee structure and the submissions received through the consultation process.

Again, the importance of the practical expertise is highlighted. They give the example of the crowdsourcing reference. We heard the member for Chifley speak today about this issue. It is something about which he has intimate acknowledge. He drew on CAMAC's work in preparing his excellent discussion paper in respect of crowdsourcing. The fact is that this is an issue that needs to be continually discussed: how do you leverage the new opportunities for corporations? As the Law Council said:

CAMAC was able to produce an internationally applauded report through a combination of thorough research and practical inputs—

into this new phenomenon. That is one of many examples of the importance and value of CAMAC. The Law Council also talked about the recent report in respect of industry innovation and competitiveness in serving to underscore the value and the importance of CAMAC and noted that the government had in that report acknowledged the importance of CAMAC, notwithstanding that, many months before, the government had announced its decision to abolish it. Doesn't that just demonstrate how odd this decision has been.

One of the concerns of the Law Council that I would echo is that if you abolish CAMAC you abolish an organisation that operates transparently. Perhaps that is part of the reason why this government dislikes CAMAC, because it is transparent, because it is disinterested, because it does look at the national and public interest. But this sort of ideological urge to get rid of everything that the government does not understand ought to be resisted when it comes to this organisation. It is an organisation that runs at under $1 million per annum yet provides such value to policymakers and industry in the ongoing need to ensure that our corporations laws are appropriate.

Kelly O'Dwyer (Higgins, Liberal Party, Parliamentary Secretary to the Treasurer) Share this | Link to this | Hansard source

I thank those members who have contributed to this debate. This has been a very good discussion about the Corporations and Markets Advisory Committee. I would particularly like to place on record my admiration for the work that CAMAC has done in years past, but that is not to say that an organisation that has been set up should be set up in perpetuity. This bill, the Australian Securities and Investments Commission Amendment (Corporations and Markets Advisory Committee Abolition) Bill 2014, will cease the operation of the Corporations and Markets Advisory Committee, or CAMAC as it is known, and its legal committee and bring the legal identity of the agency to a close. Importantly, this bill ensures that, despite the cessation of CAMAC, the rights of third parties who have interacted with the agency prior to its abolition are not negatively impacted.

While the government recognises the contribution that CAMAC has made to the development of corporate and financial services law reform, the business environment has changed greatly since 1989, when the agency was first established. The professionalism and capacity of industry representative groups is now much stronger. Further, business is increasingly active in putting its views on the operation of the corporations laws to government without the need for an additional layer of taxpayer funded bureaucracy. In addition, Treasury and the Australian Securities and Investments Commission will continue to provide advice to the government about matters relating to corporate law, financial markets and financial services. Such advice will continue to be informed by regular engagement with relevant experts and industry. The government also retains the ability to commission specific reports and inquiries utilising market specialists on an ad hoc basis or to refer matters to other bodies, such as the Productivity Commission and the Australian Law Reform Commission for advice.

This bill fulfils the government's 2014-15 budget commitment to abolish CAMAC as part of its smaller governments agenda, delivering a smaller and more rational government footprint. This agenda is designed to cut waste and duplication while improving the efficiency and focus of the Commonwealth Public Service. As noted by the National Commission of Audit last year, there are too many government bodies in Australia. This leads to duplication and overlap, unnecessary complexity, a lack of accountability, the potential for uncoordinated advice and avoidable costs.

Having established a central list of all government bodies, it was staggering to see that the government inherited a total of 1,252 separate government bodies from the previous Labor government. That is far too many, and it is appropriate that the government review these bodies and, where necessary, take action. The government has acted to do something about this, reducing the number of government bodies by 251 since the election. Some of these actions have large, monetary values. For example, the government completed the sale of Medibank Private, raising $5.7 billion in proceeds that will be recycled into productivity enhancing and job creating infrastructure.

We have also merged AusAID into the Department of Foreign Affairs and Trade, saving close to $400 million over four years. Others, like the abolition of CAMAC, have left significant savings. For example, we have ceased the Abalone Aquaculture Health Accreditation Workshop and the Albury-Wodonga Development Corporation, while the role of the Grape and Wine Research and Development Selection Committee will be subsumed into the Department of Agriculture. However, when the savings from all smaller government reforms are combined, so far it is expected to total $539.5 million, making a significant contribution to much-needed budget repair.

The smaller government agenda will continue with a fourth tranche of reforms to be announced in the 2015-16 budget, including decisions after the consideration of scoping studies initiated in the 2014-15 budget. With this bill, the government is fulfilling its commitment to abolish CAMAC and its legal committee as part of the second phase of our smaller government reform agenda. It is an agenda that makes a significant contribution to repairing Australia's budget. I commend this bill to the House.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

The question is that this bill be now read a second time.