Christian Porter (Pearce, Liberal Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I move:

That the amendments be disagreed to.

Mr Deputy Speaker, I understand that you have received written reasons to the effect of establishing—

Mr Albanese interjecting—

We can negotiate reasonable things. I will just speak briefly to those reasons. Obviously, these amendments are proposed in the context of the Omnibus Repeal Day (Spring 2014) Bill. That bill delivers, or will deliver, savings to business in the vicinity of $1.43 million, as well as administrative savings. The amendments are in two broad parts. I will first consider the amendments which, at least on their face, are attempting to be constructive but which we reject for a variety of reasons which are specific to those amendments. The second amendments relate to submarine contracts and I will deal with those last.

The first amendments are Senate amendments (1), (2), (3) and (4). They are moved by Senator Waters. Essentially, those amendments propose retaining the Product Stewardship Advisory Group, the Oil Stewardship Advisory Council and the Fuel Standards Consultative Committee. They would also seek to disallow alternative public consultation processes that would apply with respect to the grant and variation of approvals.

By way of short explanation, a statutory process is simply not required to facilitate the necessary engagement. I would also note that in MYEFO, it was noted that the Department of the Environment would save itself internally $76,000 over six years by disbanding these groups, councils and committees, which are no longer required. That is a saving that can be pushed back into further and better work to protect the environment by the department, and that is the central reason for rejecting those Senate amendments Nos (1), (2), (3) and (4).

Senate amendment Nos (5) and (6) would seek to maintain a requirement to publish certain notices under the Fuel Quality Standards Act 2000 and the Hazardous Waste (Regulation of Exports and Imports) Act 1989 in the Commonwealth of Australia Gazette. The alternative proposal which appears in the Omnibus Repeal Day (Spring 2014) Bill is essentially that those notices, which are obviously of some importance, be published on the website rather than in the government Gazette. Senator Waters has taken a view that they should remain published in the Gazette. The government takes a very strong alternative view that the Gazette, in matters of this type, is essentially the quill-and-parchment option, that actually offering people the ability to know what is occurring at this level of government to make proper comment is far better achieved in 2015 on a website than it is on the government Gazette.

These amendments (5) and (6) would also disallow a number of measures to the Hazardous Waste (Regulation of Exports and Imports) Act. They are variously amendments that would seek to disallow what the government proposes which is the removal of the requirement to specify particulars of an application in the regulations before a permanent decision can be made. These amendments would seek to disallow the clarification of matters to be included in Basel import and export permits. They would seek to disallow the clarification of the period of appointment for members of the Hazardous Waste Technical Group. They would seek to disallow a proposal that the government has in this bill to enable the Minister for the Environment to delegate his or her functions and powers under the hazardous waste act 1989 to an APS employee who holds or is acting in an executive level 2 or equivalent position. Each of those should be uncontroversial; nevertheless they are the subject of amendments.

Again, publication requirements are not being done away with; it is simply a shift of the publication requirements to a more suitable forum, which is the website rather than the government Gazette. The requirement that a person holds an Australia OECD transit permit is purely duplicatory. The Minister for the Environment would still need to be satisfied under what we propose that the transit does not pose a significant risk of injury or damage to human beings or the environment in order to exempt any person from the requirement to hold the duplicate Australia OECD transport permit.

Further, we are looking to sensibly reduce the level of detail in Basel import and export permits so that individual companies would not have to reapply if, for instance, some minor matter such as the port of entry changed on the application permit. Again, all of those things could be considered to go into the relevant document if the minister considered them to be important.

The Hazardous Waste Technical Group is being retained but, to make sure that the expertise is relevant, for a three-year period, which is entirely reasonable. The delegations we suggest are also entirely reasonable and conducive and consistent with other delegations.

With respect to what we say is the unreasonable amendment with respect to submarines, the Omnibus Repeal Day (Spring 2014) Bill has nothing to do with submarines. It has nothing to do with the Public Governance, Performance and Accountability Act. However—

Mr Butler interjecting—

The Senate says many things and not all of them are correct. What we say is that there was a six-year delay in the process of obtaining our most strategic military asset. The best advice is that the insertion of this proposed amendment into the PGPA Act would allow for a further five-year delay, and we are saving Labor from themselves by rejecting this amendment. The idea that we would put a further five-year delay in five-minutes debate on a bill which has nothing to do with submarines is patently absurd.

Mark Butler (Port Adelaide, Australian Labor Party, Shadow Minister for Environment, Climate Change and Water) Share this | Link to this | Hansard source

Labor are happy to back the Senate's wise views about these matters and speak in favour of the amendments and against the parliamentary secretary's proposition to defeat the will of the Senate in this important respect. I am not going to spend time on the bulk of the amendments that the parliamentary secretary spoke to. I want to talk about the submarines amendment. If the government had responded positively to the hand of bipartisanship that the Leader of the Opposition extended in Adelaide at the submarines conference and was willing to put all the silliness—and it is hard to find another word for the fiasco that is the government's dealings on this submarine project—of the last 18 months behind us and come to the bipartisan position that the Leader of the Opposition offered this morning then maybe this provision in the bill would not be necessary.

Again, we see politics being played by the defence minister, pushing the proposal aside just because it was a proposal from the Labor Party. You do have to ask yourself, and a lot of people in Adelaide are asking themselves this: how has it come to this? We had a 30-year, bipartisan national project at Osborne in Port Adelaide, supported by facilities elsewhere in the country, to build a serious submarine-building and shipbuilding capability in this country—a bipartisan national project sustained through the Howard years, sustained through the Rudd and Gillard years and something which the Prime Minister when he was Leader of the Opposition reluctantly signed up to before the election. He sent his defence minister, the shadow spokesperson at the time, to Osborne in South Australia and committed that the Liberal Party, if elected to government, would build 12 submarines in South Australia.

Since then, we have seen a dramatic unravelling: the sacking of a defence minister because of his ridiculous comments about the extraordinary skills and capabilities of our shipbuilding and submarine-building workforce in Australia; the apparent captain's pick by the Prime Minister to award this incredibly important nation-building project, and all of the economic activity that goes with it, to Japan; and seeking to cover-up the media releases that we understand were being prepared in the ministerial wing to announce that. We saw this become a part of the leadership spill in the Liberal Party over the last several weeks. It is extraordinary for this to become a plaything of the Liberal Party's leadership spill.

And we saw the charade of this thing called a competitive evaluation process. The shadow parliamentary secretary, who will be speaking on this debate, and her colleagues in the Defence portfolio leafed through the Defence Procurement Policy Manual to find this competitive evaluation process, but no-one had heard of it before. All this provision does is seek to return the government to the usual way in which these procurement decisions are made, and that is by way of a competitive tender. It is what the Howard government did with the air warfare destroyer project. There was a competitive tender along the lines that the Leader of the Opposition outlined in Adelaide this morning, along the lines contemplated by the amendment to this bill approved by the Senate. And this also requires that the competitive tender includes as a condition—as the air warfare destroyer tender did—that the vessels be built in Australia.

Now, an extraordinary amount of evidence has been canvassed in the Senate inquiry and in various other pieces of commentary around this debunking of a whole lot of the mythology that unfortunately became a part of this debate, such as that to build these submarines in Australia would cost up to $80 billion—a myth that I hope has now been completely debunked by expert after expert, company after company lining up to this Senate inquiry and saying that these submarines can be built at a competitive cost of around $20 billion here in Australia, reinforcing the national security reasons for doing that, reinforcing the important reasons to sustain a strong industrial and engineering skills base in Adelaide and elsewhere in Australia because of that, reinforcing the important economic benefits that come from such an important, enormous expenditure of taxpayers funds, sustaining and driving economic activity in our economy rather than an economy overseas. There should be no problem with this government finally swallowing its pride, recognising that the Prime Minister got it wrong on this—he just got it wrong—and climbing down and getting onboard with the process that the Leader of the Opposition outlined this morning.

Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Link to this | Hansard source

I support the comments of the member for Port Adelaide on the Omnibus Repeal Day (Spring 2014) Bill 2014, and I support them most strongly. What has become absolutely clear is that the Prime Minister was prepared to do a deal with Japan for the purchase of the submarines without any due process, without any competitive tender process, with no transparency and with no national interest test having ever been applied. You would think that for a purchase of this type—the largest procurement of our time—that would have been a fundamental requirement of any government and that indeed it would be a requirement in the purchase of any other product. But here we are about to go into a commitment of this type and none of that has been done. This is a commitment that not only runs into tens of billions of dollars but spans decades to come, has national security consequences and has defence capability consequences for our nation. And I would have thought that any responsible government would have done the right thing and gone through the due process, but not in this case.

To try to justify the decision the Prime Minister was about to enter into, the government firstly went about—as the member for Port Adelaide quite rightly pointed out—trashing the reputation of the Australian Submarine Corporation and, just as bad, trashing the reputation of Sweden and, by extension, one of the companies that is based in Australia and has been supporting our defence industries for years and years—and I refer to Saab Systems, which has an interest in this project. And then we see that, in desperation to save his job, the Prime Minister starts twisting and weaving in respect of his commitment. He did not care about the jobs of the people in Australia—the 3,000 people who work in Adelaide and the hundreds more who work in the other yards around Australia. But when it came to saving his job, he was prepared to twist and weave and comes back with the competitive evaluation process, which, again, as the member for Port Adelaide has quite rightly pointed out, no-one had ever heard of.

This is a commitment that, to my knowledge, no defence expert, no sector expert, no industry expert in this country, including industry broadly, has come out in support of. It has been made purely on the whim of a Prime Minister for his personal reasons. And I do not know what they are, but there has been no justification whatsoever for them. What has been even more interesting is that it seems that, even within his own party, people do not know what is going on. Only weeks ago the member for Boothby issued a newsletter to his constituents in which he said, 'whether the submarines are designed in partnership with Germany, France, Sweden or Japan'. Sweden was ruled out by his very Prime Minister in this chamber only weeks ago. Yet the member for Boothby does not seem to understand that. And, in fairness, I do not blame him, because I do not think anybody understands what is going on.

Then we come to the opposition leader in state parliament in South Australia. It has taken him a year and a half to work out that he needs to stand up for South Australia and stand up for the building of the submarines in South Australia. He finally did that yesterday, when the Advertiser put together a screed and a whole series of articles in respect of the submarines. I applaud him for doing so, but I ask the question, where have you been, Mr Marshall, for the last 18 months or so?

Today the Leader of the Opposition, speaking in Adelaide, has put on the table a bipartisanship proposal, which the member for Port Adelaide, again, has referred to. It is a two-stage proposal whereby we go into a competitive tender process and a funded definition study. All of those four countries that we know have an interest in building the submarines will be allowed to put in their submissions and be part of the proposal. But the bottom line to it all is this: the submarines have to be built in Australia and maintained in Australia. Yes, we were prepared to go into a partnership with other countries and other industries from overseas, but the work has to be done here in Australia, because ultimately it is in our nation's interest to not only keep the jobs here but, just as importantly, have the capability here and ensure that in the future we have the ability to defend ourselves and have the capability that our defence department requires if and when the time comes.

Gai Brodtmann (Canberra, Australian Labor Party, Shadow Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I rise today speak on this amendment to the Omnibus Repeal Bill. This amendment will make changes to the Public Governance, Performance and Accountability Act to ensure that the government holds an open and accountable competitive tender process for the Future Submarine project. This amendment will ensure a comprehensive project definition study is undertaken for our Future Submarine project. It also ensures that at least four bidders must be invited to take part in the limited tender.

There is nothing more important than protecting our nation. The Future Submarine project will deliver one of our most strategically significant defence capabilities at a cost of more than $20 billion. Given its scale, I cannot think of a project that is more in need of proper governance and accountability than this one. Labor understands that we need to acquire the best capabilities for the future protection of Australia while providing value for money to taxpayers. Labor also keenly understands the need to support Australian jobs—the need to support an Australian shipbuilding industry that deserves the right to compete for our future submarines.

I am standing here today supporting this amendment because Australia cannot risk a 'captain's call' when it comes to the Future Submarine project. This government has shown nothing but contempt for Defence since it came into office. It cut the real wages of our ADF personnel, the former minister claimed he did not trust ASC to build a canoe and we have seen secret deals with Japan leaked through the media This government cannot be trusted when it comes to one of Australia's most strategically significant defence capabilities. That is why we need certainty. That is why we need a bipartisan approach. That is why we need an open and transparent process and to listen to expert advice.

I would like to briefly touch on what the experts are saying. During Senate estimates last year ASC revealed it can build submarines meeting Australia's requirements, on Australian soil and using Australian workers, for between $18 billion and $24 billion. So why not include ASC in the competitive tender process? This would cancel out a whole range of technical, commercial and capability gap risks that come with committing to an overseas supplier. It would also avoid widespread job losses across the Australian shipbuilding industry—an industry that is already struggling. In Victoria, BAE shipyards has already laid off workers, with up to a further 1,400 jobs in the industry set to go. The further loss of vital skills in shipbuilding would be devastating for workers and their families but also for Australia's sovereign submarine capabilities.

Before the election, both the Liberal and Labor governments had promised to build our future submarines in Australia. The Abbott government promised Australia's 12 new submarines would be built in South Australia. But now the government has invited Germany, France and Japan to compete for the project. This represents yet another broken promise. By contrast, when we were in government we saw the need for the future submarine and worked to address it. We allocated $214 million to studies and analysis on what our needs were and what technologies were available. We selected the US AN/B-YG-1 combat system and the Mark 48 torpedos. We began working towards establishing a land based test facility to be centred in Adelaide. We established the Future Submarine Industry Skills Plan. We did this because we knew that, in order to avoid a submarine capability gap, we needed to work calmly and methodically to understand what capability the ADF needs and how we can acquire it at the best possible price. That is why the Leader of the Opposition today announced Labor's policy that Australia's future submarines will be built, maintained and sustained in Australia.

Australia's future submarines are one of the most strategically important defence assets and should not be used for political point scoring. The Prime Minister should not be constantly changing his position—as he has on so many policy issues—on our future submarines, as he did in the lead-up to the spill motion, to keep his South Australian colleagues happy. Instead, the government needs to hold an open and accountable competitive tender process for the Future Submarine project. The government needs to listen to the experts and build our future submarines in Australia. It is time the government followed Labor's policy, set out in this amendment, and put in place a proper competitive tender for this multibillion dollar project that is so critical to Australia's future security.

Michael Danby (Melbourne Ports, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

I bow to no-one in this chamber in being interested in Japanese culture and a supporter of the Japanese nation. I was very proud of the fact that, when Prime Minister Abe was here, I was mentioned in dispatches by him as one of the members of parliament on the other side who were supporters of Japan. But can you think of a project that is as big as the Future Submarine project that ought not to be seen by the Australian public as something they support because they can understand it clearly and openly as the defence of Australia being done at the best price and the best value to achieve the best result?

Collins class submarines are often denigrated around this country. But that was not the opinion I got from the admiral in charge of SINCPAC when he received a picture of an American aircraft carrier that had been taken from the periscope of a Collins class submarine. To say Adelaide should not be involved in submarine capability in the defence of Australia's future is a patently ridiculous idea. We have a strategic problem, which is that Australia is very far from other places and we need conventionally powered submarines which can travel very long distances. The idea that existing Japanese or German submarines of even the most advanced variety can do the distances from Australia to North Asia without surfacing and can be rolled off a Japanese assembly line without complications is patently ridiculous.

Even the great Soryu class submarine, which is named after the aircraft carrier that was sunk at the Battle of Midway, cannot do it; it would have to be substantially modified. What better way is there than to have an open process, as suggested by this Labor amendment, so the Australian people can understand whether these suggestions from various countries have the capability to do what they need to do for the defence of Australia. I strongly support this amendment and I think it is a very important suggestion from the Senate that should be followed.

Christian Porter (Pearce, Liberal Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

Just by way of summing up this debate, I will do my best to ensure that everyone present knows exactly what is being proposed here by virtue of Senator Conroy's amendments. We have before us the Omnibus Repeal Day (Spring 2014) Bill 2014. This bill, as its title suggests, was introduced last spring and deals with a range of rather modest matters but matters nevertheless which have the cumulative effect of reducing compliance costs for a range of businesses by $1.4 million. It has nothing to do with submarines and nothing to do with the Public Governance, Performance and Accountability Act. It has no connection whatsoever with either of those two issues or that piece of legislation at all.

Senator Conroy has used this vehicle, the Omnibus Repeal Day (Spring 2014) Bill 2014, to propose amendments to the omnibus bill which would insert an entirely new provision into the Public Governance, Performance and Accountability Act—the PGPA Act. The PGPA Act is, as its name suggests, an act which deals with the proper and consistent procedures for a range of public governance, performance and accountability issues—and, of course, amongst those, it deals with proper consistent procedures for the acquisition of military equipment through procurement. The PGPA Act does not have specific provisions for specific equipment. Nor does it have specific provisions that apply even to specific procurement processes that apply in individual departments. That is because the principle behind the PGPA, set out in section 5 of that act, is that the act's purpose is to 'establish a coherent system of governance and accountability across all Commonwealth entities'. So not merely does it not deal with any specific processes for specific Commonwealth entities, portfolio areas or departments, but it certainly does not in any way contemplate that you would have specific legislated processes in this act for a single particular piece of procurement of a single particular piece of military equipment, no matter how important you might think that that is.

When you actually have a look at the history of this act, it is instructive. The Public Governance, Performance and Accountability Act had absolute bipartisan support at the time it came into being. Both sides of this House thought it was incredibly important in matters of public governance, performance, accountability extending to procurement processes, that there be coherence and consistency and that the principles be known in advance of any major process of procurement. That concept was absolutely bipartisan at the time the PGPA Act was passed. By necessary inference, that bipartisanship also meant quite clearly that there was agreement in this place on both sides of the chamber as to what would be terribly unwise in an act of this nature. What that agreement must be inferred to be is that it would be terribly unwise to insert into act an like this, which is meant to promote absolute openness, transparency, consistency and coherence across all levels of Commonwealth government, a particular process for a particular single piece of equipment. To do that, just as a matter of good process, is absurd.

In rejecting this, as I say, we are saving Labor from themselves. They seek to make a political point. But just take a quiet moment to think about this: if these amendments were actually passed, it would fundamentally shatter the most important piece of public governance for processes of this type, just to make a rather absurd political point—and that is highly unwise. The PGPA Act clearly establishes that there is a proper process. The process which we have nominated is consistent with the PGPA Act, specifically the Commonwealth Procurement Rules issued under section 101 and the Defence Procurement Policy Manual.

But what is even worse and more substantive in this debate is that we heard the wonderful announcement that Labor today announced their policy with respect to the submarines. What a shame they did not bother to do that during six years in government. It is little bit late in the piece. They govern amazingly boldly from opposition but with the timidity of a lamb when they are actually in government. We are advised that the process that you are suggesting would add five years delay to your already existing six years delay.

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

The question is that the amendments be disagreed to.

Christian Porter (Pearce, Liberal Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I present the reasons for the House of Representatives disagreeing to the amendments of the Senate and I move:

That the reasons be adopted.

Question agreed to.

The statement read as follows—

Senate Amendment Numbers (1), (2), (3) and (4)

These amendments would propose retaining the Product Stewardship Advisory Group (PSAG), the Oil Stewardship Advisory Council (OSAC) and the Fuel Standards Consultative Committee (FSCC) and disallowed an alternative public consultation process that applied with respect to the grant and variation of approvals.

The repeal of these bodies would not prevent the Department of the Environment from consulting and engaging with industry experts on an as-needs basis without the need for costly permanent structures. The proposed abolitions would not preclude the Department of the Environment from seeking views from a broader range of organisations, experts and the community in a more flexible and targeted way. A statutory process is not required to facilitate this engagement.

Accordingly, the House of Representatives does not accept these Amendments.

Senate Amendment Numbers (5) and (6)

These amendments would disallow the removal of the requirement to publish certain notices under the Fuel Quality Standards Act 2000 and the Hazardous Waste (Regulation of Exports and Imports) Act 1989 in the Commonwealth Government Gazette and instead allow the publication of the same information on the Department of the Environment's website.

These measures do not remove the publication requirements from those Acts; rather they require the information to be published in a more accessible location (on the Department of Environment website, rather than the Commonwealth Government Gazette). As a result, the measures enhance transparency and community participation in the policy development and decision-making process.

These amendments would also disallow a number of measures to the Hazardous Waste (Regulation of Exports and Imports) Act 1989 (HW Act) including:

Hazardous Waste (Regulation of Exports and Imports) Act 1989

Publication requirements for regulations have not been removed; rather they require the information to be published in a more accessible location (on the Department of Environment website, rather than the Commonwealth Government Gazette). As a result, the measures enhance transparency and community participation in the policy development and decision-making process.

The requirement that a person hold an Australian-OECD transit permit, where the transit is from one OECD country to another and the Minister is satisfied that the transit proposal does not pose a significant risk of injury or damage to human beings or the environment is unnecessarily duplicative. The current requirement to hold an Australian transit permit is effectively duplicative of the requirement that Australia provide consent (as required by the relevant OECD Decision) to the exporting country for the movement to transit through Australia. The measures would not lessen the environmental protections as the Minister for the Environment would need to be satisfied that the transit does not pose a significant risk of injury or damage to human beings or the environment in order to exempt a person from a requirement to hold an Australian-OECD transit permit.

The requirement to specify the level of detail in Basil import and export permits currently required by the HW Act has resulted in situations where permit holders are required to apply for a variation to their permit as a result of changes that occur after the permit is issued that do not substantially change the nature of the proposal. For example, because the HW Act currently requires the place of import/export to be specified, a change in the port to which the hazardous waste is to be shipped due to changes in shipping routes would require a variation to the permit. Clarifying these matters will reduce the cost to business arising from the need to apply for a permit variation when details of a movement change. The environmental protections are not lessened by these measures as:

The Hazardous Waste Technical Working Group is being retained as it advises the Minister on technical matters that have commercial implications (for example, whether a particular type of waste is hazardous and therefore subject to the hazardous waste regime). The measure clarifies the maximum period of a member's appointment to the Working Group is three years. As members are appointed based on their expertise on matters relating to the management of hazardous waste, clarifying the period of appointment ensures that the members' expertise and experience remains current. The Minister would not be prevented from reappointing a member for a further period of three years if the Minister is satisfied that the member's expertise remains current.

The measure to enable the Minister for the Environment to delegate his or her functions and powers under the HW Act to an APS employee who holds, or is acting in, an Executive Level 2 (or equivalent) position will enable Executive Level 2 officers to exercise the Minister's functions and powers where administrative necessity dictates that decisions be made at this level. This may include:

Delegating functions and powers to Executive Level 2 officers is consistent with other legislation which contain permit regimes, including the Environment Protection and Biodiversity Conservation Act 1999 which enables the Minister to delegate any or all of his or her powers and functions to an officer or employee in the Department. The Australian Administrative Law Guide also provides that it may be appropriate for junior officers to make decisions involving a limited exercise of discretion, or under provisions which will give rise to a high volume of decisions. The delegation of these powers to an Executive Level 2 employee would not prevent significant decisions being made by more senior officers or the Minster for the Environment personally.

Accordingly, the House of Representatives does not accept these Amendments.

Senate Amendment Number (7)

The amendment proposes amendments to the Public Governance, Performance and Accountability Act (PGPA Act). These amendments would prescribe the process for entering into a contract for the design and building of a submarine, or a substantial part of a submarine, as part of the future submarine project (SEA 1000 in the Defence Capability Plan as in force on 1 December 2014).

In-line with advice from the Department of Defence, the Government is pursuing a competitive evaluation process as part of the acquisition strategy for the Future Submarine programme. This process is consistent with the PGPA Act (specifically the Commonwealth Procurement Rules issued under Section 101) and the Defence Procurement Policy Manual.

Accordingly, the House of Representatives does not accept these Amendments.