Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Hansard source

I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

COMMUNICATIONS LEGISLATION AMENDMENT (SBS ADVERTISING FLEXIBILITY AND OTHER MEASURES) BILL 2015

Introduction

The Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 provides the Special Broadcasting Service (SBS) with increased flexibility in the scheduling of advertising and clarifies SBS's ability to earn revenue through having product placement during programming.

The Bill also makes minor technical amendments to the legislation governing SBS and the Australian Broadcasting Corporation (ABC), and repeals various redundant acts and provisions from Communications portfolio legislation.

SBS advertising

SBS is Australia's multicultural broadcaster which operates under a mixed funding model. While the majority of SBS's operating budget is funded by the Australian Government, the remainder is drawn from SBS's commercial activities including advertising and sponsorship.

In 2014 the Department of Communications completed an Efficiency Study to identify savings that could be made in the back of house operations of the ABC and SBS – in other words, savings that could be made without reducing the resources available for programming.

The Study identified an opportunity for SBS to earn additional advertising revenue without increasing the maximum amount of advertising it was permitted to show over a 24 hour period.

SBS has a strict limit of five minutes of advertising per hour, which equates to a maximum of 120 minutes of advertising shown per day. However SBS earns the majority of its advertising revenue during peak viewing times – between 6pm and midnight – or when it broadcasts special events such as the FIFA World Cup.

This Bill will amend the Special Broadcasting Service Act 1991 to allow for a more flexible approach enabling SBS to show up to 10 minutes of advertising per hour but within a daily limit of 120 minutes.

This will allow SBS to schedule up to 10 minutes of advertising during higher rating programmes to increase its advertising revenue, while scheduling less advertising during other hours so that the 120 minute daily cap is not exceeded.

The 120 minute daily cap on advertising is still well below the 350 minutes per day the commercial broadcasters can devote to advertising.

It is also important to note that not all content broadcast on SBS is attractive to advertisers, as such, SBS does not currently fill 100 per cent of the time it has available for advertising across all channels and markets.

This is particularly the case in regional markets where SBS is regularly unable to fill five minutes of advertising per hour per channel, even during peak evening viewing times when its higher rating programmes are generally shown. In markets with insufficient demand, the additional flexibility afforded by the proposed measures is unlikely to result in a significant change to the amount of advertising SBS is able to attract.

Product placement

The ABC and SBS Efficiency Study also identified an opportunity for SBS to earn additional revenue through the use of product placement within particular types of programming, such as food or sports.

Product placement is widely used by broadcasters to earn additional revenue and subsidise the cost of content production.

SBS currently broadcasts acquired programming which already contains product placement from agreements made to the benefit of third parties, prior to SBS's consideration of the programme.

However, SBS does not use product placement in its own commissioned programmes due to a lack of clarity in the SBS Act regarding its use.

The Bill amends the SBS Act to specifically allow SBS to earn revenue through having product placement in its programming. It also requires the SBS Board to develop and publicise guidelines regarding the use of product placement and report on its use and earnings in the annual report. The same requirement exists in the SBS Act for the use of advertising and sponsorship announcements.

Financial impact of advertising changes

In the short term, additional advertising revenue will be directed towards meeting the government's efficiency savings applied to SBS from 2015-16. If the SBS advertising measures in the Bill are not passed before the end of this financial year, SBS will need to find other ways to achieve the necessary savings, which it has indicated may involve reductions in programming and/or services.

In the longer term, the government's intention from these changes is that SBS becomes a stronger and more sustainable broadcaster. Advertising flexibility strengthens SBS by making it less dependent on Government and helps secure its future and independence.

It is anticipated that the SBS advertising measures will result in an increase in SBS's advertising revenue of $28.5 million over four years from 2015 16. In later years, if they exceed that run rate, the additional revenues can be directed towards delivering more distinctive and innovative content and services in line with its Charter responsibilities.

Additional revenue earned by SBS is highly unlikely to have a material impact on the advertising revenue of the commercial broadcasting industry, which totalled $3.9 billion in 2013-14.

Since the introduction of in programming advertising on SBS in 2006-07, SBS's advertising revenue has steadily increased, peaking at $72.3 million in 2009 10 and $73.4 million in 2013-14, due to advertising associated with the 2010 and 2014 FIFA World Cups.

It is important to note that these two highest revenue results for SBS constituted less than 2 per cent of the commercial television industry revenue for the respective financial years.

The steady growth of SBS advertising revenue over this period has not historically led to a reduction in overall commercial advertising revenues for free-to-air television.

This is likely because of the continued growth of the entire television advertising spend over this period, which has significantly outstripped the growth in SBS's own advertising revenues. However, this total growth seems to have stagnated after the post-GFC recovery in the advertising market.

I acknowledge the opposition to this Bill from the commercial television networks; they are under pressure from new over the top entrants and the changing nature of viewing habits but I think the members here and in the other place need to recognise that any economic impact from changes proposed in this Bill is not material to their earnings.

Miscellaneous legislative changes to the ABC and SBS Acts

The Bill also makes minor technical amendments to the Australian Broadcasting Corporation Act 1983 and the SBS Act to provide consistency with other broadcasting legislation and to remove redundant provisions.

The amendments involve the insertion of some broadcasting definitions and terms in the SBS Act to make it consistent with the Broadcasting Services Act 1992 (BSA) and the ABC Act, and to reflect SBS activities that are provided in the current converging digital environment. The Bill also removes redundant definitions in the ABC and SBS Acts about election periods.

Repealing spent provisions from Communications portfolio legislation

In addition, the Bill repeals a range of provisions from Communications portfolio legislation which are spent or otherwise unnecessary. Repealing unnecessary legislation within the Communications portfolio will ensure regulation only remains in force for as long as it is needed and that remaining legislation is easily accessible.

Conclusion

The Government is introducing the Bill at this time to allow for any inquiry into the proposed legislation, which would involve a call for submissions and potentially a public hearing, to be completed prior to the Winter Sittings. As stated previously, it is important that the SBS advertising measures are passed before the end of this financial year to allow SBS to generate additional revenue to meet the required savings from 2015-16, without affecting programming and services.

The Government is committed to repairing the Federal Budget and ensuring the public broadcasters are as efficient as possible. The Government has recently reformed the procurement of and funding arrangements for transmission services for the ABC and SBS to encourage the broadcasters to adopt more efficient practices and realise savings that can be directed towards producing new content and services.

Similarly, the SBS advertising measures in this Bill will allow SBS to earn additional advertising revenue which could in the future be used to fund new programming.

Government funding currently comprises around 75 per cent of SBS's operational budget. Measures in this Bill will also lessen SBS's dependence on government funding in the future.

DEFENCE LEGISLATION (ENHANCEMENT OF MILITARY JUSTICE) BILL 2015

The Defence Legislation (Enhancement of Military Justice) Bill 2015 will amend legislation relating to the military justice system. The Bill contains a number of modest but important amendments and reforms to the Defence Act 1903, the Defence Force Discipline Act 1982, and the Military Justice (Interim Measures) Act (No. 1) 2009.

Schedule 1 of this Bill clarifies the legal character and status of service convictions, by providing that a service offence is an offence against the law of the Commonwealth. It also provides for the situations in which convictions may be disclosed under the Defence Force Discipline Act 1982.

The Bill creates two new service offences, namely that of 'assault occasioning actual bodily harm' and 'unauthorised use of a Commonwealth credit card'. These two offences did exist previously, however it is necessary to convert the offences into service offences to ensure they can be appropriately prosecuted. The Bill clarifies the elements of the existing service offence of 'commanding or ordering a service offence to be committed', thereby ensuring that an abuse of military authority can be appropriately dealt with by commanders.

Additionally, the Bill replaces the system of recognisance release orders with a system of fixing non-parole periods. This will overcome the problems associated with the ad hoc nature of service tribunals, allowing discipline to be tempered in the imposition of punishments. The Bill also replaces the system of fines for persons who are not a member of the Defence Force with a penalty units system, which aligns this form of punishment with contemporary practice in the criminal justice system.

Furthermore, the Bill corrects several technical errors which limit the ability of commanding officers to refer charges to the Director of Military Prosecutions. This will also assist warrant officers and senior non-commissioned officers in properly dealing with minor breaches of discipline.

Schedule 2 of the Bill provides for the statutory recognition of the Director of Defence Counsel Services. The position is a senior military legal officer who is appointed by the Chief of the Defence Force, and is responsible, among other things, for managing the provision of legal representation to accused persons.

The Bill also contains several machinery provisions that will assist the Director of Defence Counsel Services in the discharge of their statutory duties, as well as some minor technical changes.

In relation to Schedule 3, the Bill provides for the extension for another two years of the appointment of the current Chief Judge Advocate and the full-time Judge Advocate. The Judge Advocates are senior military legal officers appointed by the Judge Advocate General to either assist court martial members with the application of military law or to sit as Defence Force magistrates in the trial of accused persons. Judge Advocates are, therefore, central to the proper operation of the superior tribunals.

The extension of these appointments will allow the superior tribunals to continue operating while consideration is given to further reforms to the military discipline system.

The Bill contains a number of modest but important changes to the military discipline system and the overarching military justice system. The amendments and reforms demonstrate, once again, this Government's commitment to the security and defence of Australia and its interests. Moreover, these amendments signal this Government's commitment to modernising the military discipline system.

I commend the Bill.

SOCIAL SERVICES LEGISLATION AMENDMENT BILL 2015

This Bill will implement a measure announced in the 2014-15 Mid-Year Economic and Fiscal Outlook, ceasing social security payments to certain people who are in psychiatric confinement because they have been charged with a serious offence.

The people involved are primarily those who have been charged with a serious offence and who, due to a mental impairment, are in psychiatric confinement, including those who have been not convicted or considered not fit to stand trial.

This essentially represents a return to the original policy intention for people in these circumstances—that a person cannot access social security payments while in psychiatric confinement as a result of criminal charges. The current arrangements flow from a 2002 Federal Court decision, meaning that most people confined in a psychiatric institution may be considered to be participating in a course of rehabilitation and therefore attract social security payments.

In fact, it is the relevant state or territory government that is responsible for taking care of a person's needs while in psychiatric confinement, including funding their treatment and rehabilitation.

People will be subject to this measure if the serious offence with which they have been charged is a violent one such as murder, attempted murder, manslaughter, rape or attempted rape.

Similarly, the measure will apply in relation to offences under Commonwealth, state or territory law that are punishable by imprisonment for life or a period of seven years or more, where a loss of or serious risk to life, wellbeing or safety is involved.

Payments will resume in certain circumstances to people who are integrating back into the community.

A social security payment will continue to be payable to a person who is undergoing psychiatric confinement because the person has been charged with an offence that is not a serious offence, if a person is undertaking a course of rehabilitation.

Similarly, a social security payment will also continue to be payable if the person's psychiatric confinement is for reasons unrelated to the commission of an offence.

The measure is due to be implemented from 1 July 2015.

TAX AND SUPERANNUATION LAWS AMENDMENT (MEDICARE LEVY AND MEDICARE LEVY SURCHARGE) BILL 2015

This Bill amends the Medicare Levy Act 1986 toincrease the Medicare levy low-income thresholds for singles, families and single seniors and pensioners in line with increases in the consumer price index. These changes will ensure that low-income households who did not pay the Medicare levy in the 2013-14 income year will generally continue to be exempt in the 2014-15 income year if their incomes have risen in line with, or by less than, the consumer price index.

In addition to providing a concession to low-income households, the Medicare levy low-income thresholds ensure that people who pay no personal income tax due to their eligibility for structural offsets — such as the low-income tax offset or the seniors and pensioners tax offset — do not incur the Medicare levy.

The changes to the thresholds mean that, for individual taxpayers with income under $20,896 in 2014-15, no Medicare levy will be payable. Single seniors and pensioners with no dependants who are eligible for the seniors and pensioners tax offset will not incur a Medicare levy liability if their income is less than $33,044, and couples and families (who are not eligible for the seniors and pensioners tax offset) will not be liable to pay the Medicare levy if their combined income is less than $35,261.

It is not proposed that the threshold for couples seniors and pensioners will be increased at this time. Couples who are eligible for the seniors and pensioners tax offset do not incur a Medicare levy liability when their combined income is less than $46,000. This threshold will remain sufficient to ensure that those eligible will not be liable for Medicare levy when they are not otherwise liable to pay income tax.

The increase in thresholds will apply to the 2014-15 year and future income years.

Full details of the measure in this Bill are contained in the explanatory memorandum.

Debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.