Christine Milne (Tasmania, Australian Greens) Share this | Hansard source

I have some sympathy with Senator Joyce’s amendment because of the appalling experience that people around Australia had with the virtual non-existence of the oversight of the managed investment schemes by the Australian Securities and Investment Commission. We found that ridiculous commissions were being paid and that, contrary to financial regulation, they were not transparent to investors who were discussing matters. The investors were not even aware that often the people that they were talking to had special arrangements with various companies, and so on. However, we also concur with the government that a parliament cannot regulate to this level in the financial market.

I have to put on the record that I do not think ASIC has done a very good job at all in regulating this and I am very fearful that the carbon market will end up with the same sorts of sharks that we have seen wherever complex financial products have been developed—as the managed investment schemes turned out to be. You get middle people who make vast fortunes out of dealing in bits of paper, and there is not very good transparency so it is quite difficult to track exactly what they are trading in. That is what happened with the derivatives market, and I am fearful we will end up with exactly the same thing in the carbon market. That is not just an issue for the Australian carbon market; it is an issue for the global carbon market. How you regulate the carbon market to ensure transparency, proper oversight and so on is a matter that is quite widely discussed in international circles.

I just wanted to put on the record that I completely understand where Senator Joyce is coming from. Poor oversight in Australia has resulted in a lot of people losing a great deal, and the managed investment schemes are a classic case. I think it would be appropriate, prior to the review stage of the establishment of such a scheme, for ASIC to be put on notice about the need to introduce appropriate oversight of the carbon market as it operates in Australia and also in the context of how it operates around the world.