Nick Xenophon (SA, Independent) Share this | Hansard source

The Australian Business Investment Partnership Bill 2009 is one of those bills that presents a dilemma for this parliament. That is because in legislation as in life wanting to help is not the same as actually helping. My main concern, one that I believe is broadly shared with my coalition colleagues, was that I did not want any new legislation to create unintended consequences. I did not want ABIP to create a cartel or another bank. I did not want ABIP to prop up ventures that should by any commercial standards not be propped up. I was concerned that the creation of ABIP might serve as an incentive for foreign and smaller domestic banks to withdraw from the market and, ultimately, I was concerned about what this means for taxpayers.

Taxpayer funds are not like shareholder funds. Shareholders choose to get into business. They assess the risks and decide whether to put the money on the table and take a risk. Taxpayers do not do that. They pay their taxes because they have to, which is why I believe there must be a higher standard for the way we use taxpayer money, particularly where there is a contingent liability and especially when the government enters into a business arrangement with businesses. Throughout this debate I have raised a number of concerns about this bill with the government and I am pleased that the government agreed to a Senate inquiry process by the Senate Committee on Economics, of which I was a part, because that was a very valuable exercise in getting more facts, in getting the information that I believe was necessary in order to make an informed decision on this piece of legislation.

I want to outline my concerns and put them on the record in the context of my discussions with government, but before I do that I want to outline the concerns expressed by Senator Bob Brown on behalf of the Greens and Senator Fielding on behalf of Family First. Senator Brown has maintained a long-term campaign on the issue of executive remuneration. I commend him for that campaign and, as I understand it, his position is quite straightforward. If you are going to have a situation where taxpayer funds will be used to assist the private sector, there must be a quid pro quo on the whole issue of funding of executive remuneration. Whilst I do not see that going directly to the core of this bill, I respect and appreciate the concerns of Senator Brown and I will be supporting the Greens amendments to curtail executive remuneration packages for those entities that are assisted in what ABIP is proposing to achieve. I think that is important and I think the government should take the concerns of the Greens seriously with respect to executive remuneration.

Senator Fielding has raised a number of concerns in relation to the issue of ensuring that there are safeguards in lending criteria. In his contribution yesterday, Senator Fielding said:

... ABIP must satisfy lending criteria which, at a minimum, are just as strict as the lending criteria applied by any other commercially competitive bank.

I commend Senator Fielding for raising that. These are my concerns also, and I look forward to seeing an amendment to the legislation that the government, I understand, is preparing or that Senator Fielding will be introducing on this, because I believe that is a legitimate concern in safeguarding shareholder funds.

I have also raised concerns with respect to the issue of the role of the Auditor-General. If I could put on notice to get a response about the role of the Auditor-General from the government either in their summary of the second reading stage or during the committee, the bill provides for the Auditor-General to have a role to audit the books, to have that supervisory role, if you like, in relation to the accounts of ABIP. I simply seek confirmation that the Auditor-General is unfettered in his role with respect to that and that if at any time there is a concern about the operation of ABIP the Auditor-General has the right and the role to, if not intervene, investigate any concerns—which is I think highly unlikely given the governance structure of ABIP. Similarly, as I understand it, ASIC will have a supervisory role here in the operation of ABIP, and confirmation of that from the government would be helpful.

There is the issue of trade practices law that Senator Hurley referred to. The issue of exemptions from the act is one that concerns me. There has been an increasing trend to exempt, to have arrangements where an exemption is granted under the act. This is something that Associate Professor Frank Zumbo from the University of New South Wales Australian School of Business has raised, and I am grateful for his input into this. Some may not be as grateful as I am for the contribution that Professor Zumbo makes. I note that Senator Arbib is having a chuckle at that.