Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Hansard source

My remarks bring the second reading debate to an end. It will not surprise Senator Evans that the government will not be accepting the second reading amendment. We welcome the support of the Labor Party for the Corporations (Aboriginal and Torres Strait Islander) Bill 2006 and related bills, albeit a trifle grudging at times. Nonetheless, we welcome that support and I acknowledge the contributions, mostly thoughtful, that have come from senators who have made speeches in this debate. I particularly want to commend my colleague Senator Payne for her remarks and her hard work on this bill. I am very glad that Senator Evans also acknowledged the interest and work of Senator Scullion.

The Aboriginal Councils and Associations Act 1976 was passed 30 years ago to cater for the small number of landholding corporations linked to the first land rights legislation. There is broad agreement that the legislation no longer meets the needs of Indigenous corporations or their communities. One of the points that Senator Evans raised in his remarks concerned red tape. I think this issue has been of concern to a wide range of people, particularly to the corporations involved. The advice I have is that there will be less red tape for the majority of corporations. One of the express aims of the registrar is to administer the bill with a minimum of procedural requirements. The key compliance obligation is in the reporting area. The advice I have is that the reporting requirements for small and medium corporations will decrease. The reporting requirements for large corporations will increase and align with mainstream standards. This implements a key recommendation of the independent review, which found that large corporations can generally recruit competent personnel to carry out these requirements.

The bill has maximum flexibility built into it. This ensures that support and regulation can be tailored to the needs of particular corporations. I am advised that the registrar will use this flexibility to reduce red tape, which will be music to Senator Evans’s ears. The registrar’s office will offer assistance to make the required changes. There will be a number of tools and guides for corporations, members and directors, and the registrar’s office has a free telephone hotline for inquiries about this bill. This deals with one of the concerns that Senator Evans raised.

The new legislative package responds to the need for improved corporate governance in Indigenous communities in a number of ways. It aligns the government’s requirements for Indigenous corporations with modern standards of corporate accountability while at the same time allowing flexibility for Indigenous communities to design corporations that suit the diverse circumstances of the 2,500 communities located all over Australia. These corporations serve many different purposes, from holding land and delivering essential services through to operating health and legal services and running businesses such as Indigenous arts centres. Indigenous corporations are essential to the lives of many Indigenous Australians, and it is not appropriate for them to have lower standards of corporate governance.

The legislation ensures special support and a regulatory environment that is tailored to the risks and requirements of the Indigenous corporate sector. However, special support and regulation needs to be consistent with the practices and standards of other corporate regulators. The backbone of the bills is the application of mainstream governance standards to Indigenous corporations. For example, directors and senior officers who are running and managing corporations will now have the same obligations as mainstream directors and officers. However, I should say that the bill offers a flexible framework, allowing the special circumstances of individual corporations to be taken into account. For example, communities can structure their corporations in ways that suit their needs and aspirations.

The bill also provides a strong internal governance framework that offers transparency of operations for members and key stakeholders. Regulatory powers such as the appointment of a special administrator allow the important services the corporations provide to continue in the event that these services are put at risk through corporate failure. Unlike the existing act, the appointment of a special administrator under the new legislation will carry with it the new rights of review that are currently unavailable. The new legislation, as I said, allows for red tape to be reduced.

Amendments made in the House of Representatives have led to improvements in the main bill. Some of these amendments were responses to feedback from a range of stakeholders, including, I might say, submissions made to the Senate Standing Committee on Legal and Constitutional Affairs. In its report, the committee considered that the bills will make a significant contribution to improved governance and accountability. The government has already responded to recommendations of the committee, but I note that the recent $28 million budget initiative to strengthen the capacity of Indigenous corporations will include funding associated with the implementation of the new act. This is in addition to the Registrar of Aboriginal Corporations existing funding.

With its core and additional funding, the Registrar of Aboriginal Corporations will provide support to Indigenous corporations through an information and complaints hotline, do-it-yourself tools, a new model constitution, fact sheets, troubleshooting sessions, governance training and capacity-building and compliance training. It will help corporations through the transitional process where it is needed. The registrar’s office has already embarked on some of these measures. The registrar will monitor the implementation of the new act for three years, which covers the two-year transitional period given to existing corporations to align with the new act. The registrar will do so by monitoring and responding to transitional issues that arise, through its suite of services provided to Indigenous corporations. The registrar will monitor the take-up rate by corporations under the new legislation, including special options for extra support and tailoring rules. The registrar will also monitor the rate of compliance and reasons for noncompliance. Details of the monitoring of the implementation of the legislation will be published in departmental annual reports and the registrar’s yearbooks for the three years.

The government also accepts the recommendation of the committee to report on this matter to parliament at the end of the two-year transitional period. We believe that the transitional provisions, which set out how corporations will move from the old regime to the new, will minimise the administrative burden on existing corporations. They will have up to two years to meet the requirements of the new act. The Corporations Act will also be amended to remove existing regulatory gaps.

These are essential and widely accepted reforms that complement other changes being implemented by the Australian government, designed to deliver a better future for Indigenous people in Australia. As I mentioned, we will not be accepting the second reading amendment. That will come as no surprise to Senator Evans and his colleagues.