Trish Crossin (NT, Australian Labor Party) Share this | Hansard source

I rise this morning to provide a contribution to the debate on the changes being proposed through the Corporations (Aboriginal and Torres Strait Islander) Bill 2006, the Corporations Amendment (Aboriginal and Torres Strait Islander Corporations) Bill 2006 and the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2006.

Senator Payne made some comments about the cooperation of the Senate Standing Committee on Legal and Constitutional Affairs in inquiring into these bills in the last 12 months. The initial amendment bill, which was pretty thick in terms of the number of pages and complexity compared to what Indigenous organisations and corporations now have to deal with, was somewhat overwhelming. But the legal and constitutional committee did agree cooperatively to put on hold the outcomes of their inquiry into this bill and the report until we had seen the transitional legislation. That has occurred.

The bills include many measures to replace the Aboriginal Councils and Associations Act 1976. According to the explanatory memorandum, the aim is to improve the governance and capacity of Indigenous organisations. I do not intend to go into great detail about these measures, although it will not come as any surprise to people listening that I might have some comments to make about what is currently occurring at the Mutitjulu community in the Northern Territory.

The original act was an incorporation statute to provide a fairly simple means for Indigenous people to establish legal corporations. It was last amended in 1992 to improve external accountability and is now considered to be out of step with modern corporations law in Australia. It was seen—and I hope it still is—that Indigenous incorporation needs are different from those of mainstream Australian corporations. Their associations tend to be quite small, are usually non profit making, are often remote and involve people for whom English is at best a second language and for whom education standards are below those of mainstream non-Indigenous people.

When people have a concept about Corporations Law, they need to very clearly separate out in their minds the application of this law to Indigenous corporations and associations and its application to big business and multi-business corporations. Indigenous people have had their own culture and traditions—including clan leaders, traditional owners of land and so on—for thousands of years. In many areas of my electorate, Indigenous people had, and still have, their own traditional laws of governance. Even under the original Aboriginal corporations act, much of the legislation was based on non-Indigenous law and was often pretty foreign to the people to whom it applied. In instances today, that is still predominantly the case. It has taken people a long time to get a basic understanding of it. I believe that there are still people working within local government, in particular, in the Northern Territory, who say that many Indigenous people in remote areas still do not fully understand, appreciate or realise the intent of such legislation.

Despite any such problems of understanding existing regulations—and I use figures from my colleague in the other place—some 2,800 Aboriginal and Torres Strait Islander corporations are currently registered. That is a pretty large number, but I suspect that most of them are very small corporations. These new acts have come about as a result of a review by the Registrar of Corporations, who reported in 2002 that there was a need to change, a need to update the old act, while still keeping in mind the specific incorporation needs of Indigenous people. The review reported that a new act should provide for modern needs and, at the same time, provide some form of regulatory assistance to support modern standards of corporate governance.

The old act, dating back as it did from 1976, was undoubtedly outdated, and there is a need for some form of change. Labor supported this need for change, but I have some concerns about several matters that are connected with these bills. They are reflected in the second reading amendment that has been moved by the Labor Party both in the House of Representatives and here in the Senate. These bills supposedly provide a more up-to-date framework for governance, while at the same time providing flexibility for special Indigenous factors such as cultural practices and any particular local needs and circumstances. The explanatory memorandum states that one reason for the need to change is that the substantial amount of public moneys provided to Aboriginal corporations has highlighted deficiencies in the old act. Returning to the principle of accountability—with which, I am sure, we all agree in principle—I sincerely hope that these changes are not part of what seems to be a witch hunt against Indigenous organisations by this government.

One of the first things done by this government on coming into power over a decade ago was to have the then Minister for Aboriginal Affairs engage a major accounting firm to do a total audit on all Indigenous organisations funded by ATSIC. The belief seemed to be that dishonesty and corruption were rife. However, the audit found that this was certainly not so. Indeed, the Federal Court later found the appointment of this auditor to be invalid. So now we appear to be back to those old days, where Indigenous organisations were strictly scrutinised and monitored for rigid compliance to rules and regulations.

In my own electorate over the past few months the Mutitjulu community have had funding suspended; for instance, Southern Barkly Aboriginal Corporation was closed down completely. I have had several other Indigenous organisations also complain that they have been threatened with closure or had fund releases subjected to lengthy delays because they were held to be in breach of one regulation or another, all over a few thousand dollars—organisations like Merrepen Arts or Majimap, in Malak, to give some examples. At the same time government departments such as Defence are purchasing billions of dollars worth of equipment, which then turns out to be less than ideal or takes forever to be modified and delivered at huge additional cost. Or Defence is purchasing small equipment for troops through poor procurement procedures and then finding it too is not suitable for the use it was to be put to. I even remember not so long ago Defence being unable to account for the whereabouts of tens of thousands of dollars worth of computers. What happened there? It made the papers for a few days and then got papered over and forgotten.

This would not happen with Indigenous organisations though—they get slammed. They get administrators appointed, as in Mutitjulu, for no valid reason whatsoever. They get a zealous minister going to the press, jumping on them from a great height or, even worse, making totally unfounded claims about what terrible things are going on. But I do not see the same sort of reaction occurring with the Department of Defence and their gross mismanagement of their funds and their lack of audited accounts year after year after year. I hope these bills truly represent changes which will benefit Indigenous corporations and will not be used as a means to further beat them down.

When initially introducing the bill in June 2005, the then minister for Indigenous affairs, Senator Vanstone, announced a rolling program of governance audits and explained that the bill would strengthen accountability provisions. Indigenous people are sick and tired of being victims of unscrupulous or incompetent administrators. The Northern Land Council, while accepting that corruption anywhere is unacceptable, pointed out the lack of any real evidence for such claims. Despite the possible inappropriateness of the old act, most Indigenous corporations do seem to comply, or do their best to do so. There seems to be little real dishonesty. I am far from being the only one with concerns about this legislation, which I fear may prove to be overly complex and lacking in genuine support for those corporations affected. The Woodward report of 1974 stated:

The legislation must be simple ... it must be flexible ... it should make provision for Aboriginal methods of decision making by achieving consensus rather than majority vote ... it must contain simple provisions for control over a situation if things go wrong within an organisation ...

With over 500 pages included in this legislation, it is hard to believe that it achieves these criteria to any great degree. How can over 500 pages be simple? It seems impossible for those who draw up legislation—non-Indigenous lawyers and bureaucrats—to understand and empathise with real Indigenous values and needs. They lack the relevant experience to do so.

The Senate Standing Committee on Legal and Constitutional Affairs inquired into the provisions of this legislation, as outlined by Senator Payne, and presented their report earlier this month, on 9 October. While a need for some change was acknowledged by several organisations in their submissions or at hearings, land councils tended to criticise the initial legislation for being too large and far too complex. At the time of submissions and hearings, information on amendments since made was not available to organisations. As Senator Payne outlined, we were waiting for transitional legislation to see exactly how this would transpire. The Central Land Council, from my own electorate, stated in their submission:

... it is a complex statute designed to regulate large corporations.

They summarised their views as being unable to support the bill in its current form. They do not believe that it meets the special needs of Indigenous people; that potentially regulation could be very intense; that the bill is too prescriptive and may deter Aboriginal groups from using the statute; that many organisations struggle to meet the requirements of the existing legislation; and that what is needed is more assistance, not increased regulation and complexity.

The Northern Land Council said in their submission that they ‘recognise that the bill includes important accountability measures but considers it is seriously deficient in important respects’. They also could not support the bill in its current form. They continued:

... the Bill ... is overly prescriptive such that many unfunded, under resourced or remote ... corporations will be incapable of compliance ...

While general comments have later indicated a better degree of satisfaction with the transitional and amendment bills, doubts still remain about the legislation as a whole.

In the report of the Senate Standing Committee on Legal and Constitutional Affairs, Labor senators comment that they ‘remain concerned, however, about the level of regulation and the extent of the registrar’s powers’. At the hearings, staff of the Office of the Registrar of Aboriginal Corporations assured the committee that power to access books would not result in the examination of documents covered by legal privilege or any privacy rules. We can only take their word at this point in time. The potential still exists for the registrar to hold enormous power in issuing compliance notices and then, for example, to allow the registrar to appoint an authorised person to ‘assist’ in that compliance. While such legislation may be well meaning and intended to help with the provision of expertise, it does leave the way open for abuse and the overriding of Indigenous control and processes.

It is little use sending in some sort of non-Indigenous administrator unless he or she actually works with the Indigenous people; otherwise, they will learn little or nothing from any such exercise to improve future governance. Here I refer to the Central Land Council’s submission in which they said more assistance, not more complexity and regulation, was needed. Again, it seems to me that the government does not realise or appreciate how much assistance, training and mentoring is needed in these remote organisations. Appearing before the committee, Professor Mick Dodson said:

Let us stay with what we have because the new bill is far too complex.

While noting that the transitional bill does extend some degree of flexibility in acknowledging special Indigenous needs, Labor senators also reflected:

... there can be no certainty that these bills reflect an appropriate level of regulation which is workable for the specific conditions of the Indigenous corporate sector until they come into operation and have been tested in practice.

For this reason, we have recommended that the Office of the Registrar of Aboriginal Corporations closely monitor any effects of these changes for three years. I understand that there is an amendment on behalf of the Labor Party to be moved to that effect. However, even here I have concerns about the true independence of the registrar and about how independently of government interference they will be able operate if they are to be appointed by the minister. We have seen instances of that in the Northern Territory in only the last six months.

Furthermore, as previously mentioned, some of the amendments made since the introduction of the initial bill were not available to the public or specifically to Indigenous organisations wishing to submit or appear at committee hearings. As a result, the Indigenous corporate sector has not been able to examine and consider the amendments in what I would consider to be a reasonable period of time. This is again another example of where the government is simply not allowing for proper discussion or debate of this issue with the people most affected by it. We have groups such as the Central Land Council saying of the initial legislation that they could not support it. Groups like this definitely should be listened to and taken seriously.

Amendments and consequential legislation may have alleviated some of these concerns, but many still remain. While Labor supports these bills, the implementation of this legislation must be closely monitored with a preparedness to genuinely listen to Indigenous organisations, who should be given all and every assistance in the transition period. These changes could be used to genuinely help Indigenous organisations to improve their governance, not as further heavy-handed government intervention.

I want to mention the second reading amendment that Labor has moved in the House of Representatives and that will be moved in the Senate. For the record, I reiterate that, whilst we welcome many of the positive measures contained in the bills, there are still some concerns that remain on behalf of the Labor Party. These concerns go to ensuring that the government responds immediately and comprehensively to a recent report commissioned by the Office of Indigenous Policy Coordination, which found red tape and short-term, ad hoc funding arrangements were severely debilitating the Indigenous corporate sector—interestingly, the government’s own department found that to be the case. This legislative reform will not address these external causes of instability to corporate governance.

The government must also ensure adequate funding for training and assistance for the Indigenous corporate sector to build their governance capacity and facilitate a smooth transition to the new regime, particularly as many Indigenous corporations deliver essential services. This was a unanimous recommendation of the Senate committee that inquired into the bill. All of us have recognised the need to ensure that the governance training of the office of the registrar does in fact increase—that is, that it is adequate and comprehensive.

There are significant outstanding concerns in relation to the level of regulation and the extent of the registrar’s powers in the bill, particularly given the lack of full independence of the registrar from ministerial and political interference. For the next three financial years the Office of Indigenous Policy Coordination should include in its annual report a review of the operation of the new legislation and results of a statistical survey of stakeholder satisfaction to ensure that the impact of the legislation is closely monitored and with appropriate transparency. We want to see some department within this government monitoring the impact and the flow-on of this new legislation and the effects that it will have on Indigenous people and their organisations.

The government should also ensure a review of the operations of the Corporations (Aboriginal and Torres Strait Islander) Act by a parliamentary committee within three years. We suggest that in three years time parliament should conduct a review to see what is happening with particular regard to the effective and proper use of the registrar’s powers under the act and the effectiveness and appropriateness of the act as a regime of corporate law for Aboriginal and Torres Strait Islander people. So while we will support this legislation, albeit with some changes and with a second reading amendment, and some of the improvements are worth supporting, we do have concerns that Indigenous people are fully trained and aware of the impact of this legislation, that they are not barrelled into a situation where they are bullied by this government into complying with regulations and requirements that they do not fully understand, and that the office of the registrar is used wisely and independently of this government, not simply as a puppet to impose unwieldy limitations on Indigenous people that are not necessary. (Time expired)