Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

The Governance Review Implementation (Science Research Agencies) Bill 2007 is part of a procession of legislation coming before parliament implementing the recommendations of the report of Mr John Uhrig. As we know from similar legislation considered recently, the Uhrig report recommended new governance arrangements for many government agencies. The simple purpose was to streamline accountability—that is a pretty straightforward management practice. It is also about efficiency and better defining roles, responsibilities and relationships. It is about gaining greater clarity and clearer lines of communication in organisations. Most importantly, it is about improving the relationship between government ministers and the bureaucracy. We support this legislation because all this is good governance. But it is more than just the relationship between government ministers and chief executives; it is also about relationships, lines of communication within organisations and lines of communication between organisations.

As we know, the Commonwealth has an incredible maze of organisations. First, there are the line departments, which are the principal sources of policy and program management. In most portfolios there is a swag of smaller agencies, and some of these are established by specific statute. The list is long and there is a huge variety under each source of authority. The summary developed by the Department of Finance and Administration is very informative. Roughly, there is a division between those covered by the Public Service Act and the Financial Management and Accountability Act and those which are not; however, most are covered by the respective acts. There is an inclination to bring as many agencies as possible into that framework for consistent governance and accountability. There are other agencies which are not dependent on budgets and which are more commercially orientated, and they are accountable under the Commonwealth Authorities and Companies Act. They must be set up by legislation for a public purpose and they must be a body corporate and hold money on their own account. Slowly but surely we are now seeing a convergence of governance into these models.

There are, of course, a few anomalies. Parliamentary departments are a case in point, and there are some with historic origins which are politically difficult to tinker with. For example I refer to the Repatriation Commission, set up under the Veterans’ Entitlements Act. When considered against the principles of the Uhrig report and the government’s program, this does still remain an anachronism. The bill today addresses governance changes for the above reasons in CSIRO, the Australian Institute of Marine Science and the Australian Nuclear Science and Technology Organisation. The principal change is in the appointment of the CEO, except for ANSTO. Instead of the Governor-General being the appointing power, there has been a shift to the board of each agency. These agencies therefore retain boards with executive power. That is distinct and different to other agencies where boards have been abolished or have lost executive power in favour of a more advisory role. The distinguishing factor is the degree of dependence on the budget and the independence considered appropriate by government. CSIRO, for example, while partly budget funded, also has a growing commercial interest. This for many has been a serious bone of contention, because its governance structure should reflect the nature of its business. Likewise, the role of the minister might need to be circumscribed. In this case, the minister’s responsibilities, for example, for contracts and funding limits have been reduced. For a quasi-commercial organisation such as CSIRO, that is also appropriate.

I do not need to go further into the specifics here but say that this rationalisation does make sense. But, as I have noted before on similar legislation, accountability is more than organisational structures and lines of reporting. It is more than improving communication and having better role clarity. It is also more than performance contracts and agreements, such as ministerial statements or letters of expectation. More than anything, it is about behaviour. And governance in the private sector is no different.

Look at the great catastrophes of recent times—for example, HIH. No amount of corporate legislation can prevent that sort of corruption. It is true that sanctions are available and that they do have some teeth. But that is not much solace for all of those investors who lost so much. Seeing some of the crooks behind bars might offer some comfort, but not enough. It is likewise with government agencies. Good governance does not guarantee good performance. In almost every case, good performance comes from good people.

Government agencies need worthwhile managers. Sometimes, as we know, that creates a dilemma, especially for those agencies with high specialisation. That might be specialisation in the law, medicine, science and many areas of research and policy development. Finding a CEO who has that status as well as the experience and the technical skill and reputation is sometimes, indeed often, difficult. This is particularly the case for the three agencies which are the subject of this bill.

The most critical element of each organisation is the quality of the chief executive officer. It is about far more than managing an internal budget. It is about being a leader in science and research and having a high personal reputation in the research community. Budgets are not difficult to manage; building commerciality and winning revenue are. Acting and managing organisations such as these in the public interest is also a most critical element. These organisations have few, if any, real competitors except, perhaps, within the research area, which as we know is rich in highly specialised niche sectors.

ANSTO is essentially regulatory and AIMS is uniquely concerned with the protection of our marine environment. So there is considerable diversity in these organisations, for which good governance measures must be applied. Let us hope that the refinements of the different models being made in this bill work to their advantage.

Let me conclude by repeating the remark I made about accountability the last time I spoke on a similar bill, and let me repeat the point I have made about behaviour being the fundamental ingredient of governance. The irony should not be lost on us. Despite this wonderful emphasis on accountability, it is being introduced by a government whose behaviour is the antithesis of good governance. The Howard government is probably the least accountable government this country has seen for a long time. The contradiction is absolutely breathtaking. We could go on for hours about the litany of failed accountability, but it would take much too long. We see it here at question time every day. We see it in nonanswers to questions on notice. We see the parliament being treated with contempt by ministers who prefer to say that it is too hard to answer a question—or, alternatively and increasingly, questions are deliberately misconstrued. I could go on.

The great disappointment in this behaviour is that others see their leadership’s values at work and in an open manner. Monkeys do as monkeys see. The example being set for the values and future behaviour of government is a matter of ongoing concern. The behaviour of spin, cover up, deceit and misrepresentation is now becoming universal. No matter how good our governance structures appear to be on paper and in black and white, it matters little if the current decline in government standards continues unabated.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister for Industry) Share this | Link to this | Hansard source

As Senator Bishop has already indicated, the opposition is supporting the Governance Review Implementation (Science Research Agencies) Bill 2007. We do so because, as has clearly been indicated, it makes sense to have clearer lines of communication and responsibility. It is particularly appropriate that CSIRO, ANSTO and AIMS, the premier scientific bodies responsible for our national and international research effort, are given appropriate administrative support to ensure that they can fulfil their proper functions, especially considering the enormous contribution that they have made over time and that I believe they will continue to make in the future. They represent public research assets which are the envy of many other countries. Collectively, over an 80-year period, these agencies have undertaken research programs that have saved existing industries and created new industries. They are absolutely vital to our national innovations system and they have profound national importance. As part of a national innovations system, they provide this country with the resources it needs to meet some of the challenges we face with respect to the great questions of our time, such as the ageing of the population, climate change and globalisation. They provide this country with a huge capacity to support our manufacturing industries, to advance new manufacturing industries and to find new technologies that allow us to meet the challenges of the day. So the governance of these agencies is of considerable importance.

In the case of AIMS, the legislation shifts the powers of governance towards the AIMS council, away from the minister. This is particularly important with regard to the appointment of a chief executive officer and the new power of the council to directly appoint the new CEO. Similarly, in terms of ANSTO and CSIRO, the legislation clarifies the relationship which exists between the CEO and the various boards or councils. Labor supports this legislation because it clarifies the financial responsibilities and the accountability of the boards of these organisations. They are very useful reforms.

I know from recent discussions with CSIRO that the project in contract management has been less than perfect. Contracts have been awarded on occasions to people in, I think, highly dubious circumstances. I have made these points at Senate estimates hearings. The Senate estimates process will still operate and provide us, as members of parliament, with an opportunity to pursue these matters. But, frankly, if these powers had been in place at the time of these events I have spoken about then there would have been a different response from those organisations. The fact that the minister failed in his duty of public accountability at the time is regrettable. So I look to the boards and the councils of these organisations to take up these new responsibilities with gusto. It will place greater importance upon the relationships between the minister and these boards. Frankly, a higher and more sophisticated response will be required as to the operation of these boards by way of direct line through to this parliament via the minister.

The autonomy and the integrity of these agencies should be foremost in our thinking. Notwithstanding the fundamental value of the research that these agencies undertake, the public perceptions of these organisations depend largely on the management of these organisations. This can be highlighted in the authority with which these organisations speak on scientific matters. The future health of our national research effort demands no less. But in recent times we have seen a ham-fisted—in fact, incredibly clumsy—approach to the capacity of our scientists to undertake research and to engage in public comment about the significance of research. Only two years ago the debate within CSIRO on climate change was a matter of some considerable public controversy. In recent times there appears to have been a shift in the policy directions of organisations on the capacity of scientists to speak out, and it is something I welcome. However, questions about the capacity of ministers to intervene to steer public debate on matters of scientific interest still remain. Therefore, these reforms go some way to providing a clearer demarcation of responsibilities to manage these organisations.

The employment of staff and the status of senior staff within these agencies ought to be the responsibility of these boards, but the responsibility for the general welfare of these organisations cannot be abrogated by the parliament. We have an ongoing responsibility to ensure that there is appropriate accountability through the estimates process and that the welfare of these agencies and councils is in fact protected. The prosperity of this country depends upon our capacity to remain competitive and productive and that, in my view, depends on our capacity to strengthen our national innovation system. That is precisely what the government has failed to do. It has failed to appreciate just how important these organisations are by not ensuring that that occurs. It has failed to ensure that their integration within the national innovation system is in fact upgraded and that there is a capacity for our scientists to contribute to public debate and genuine research effort to allow us to meet the challenges that lie ahead.

That is why Labor have proposed a comprehensive reform program for our national innovation system. We are committed to a comprehensive program to stimulate innovation, competitiveness and productivity in which these public research agencies will have a central role. Therefore, like Senator Bishop, I commend this legislation to the Senate.

Brett Mason (Queensland, Liberal Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

I thank Senator Bishop and Senator Carr for their contributions to the debate on the Governance Review Implementation (Science Research Agencies) Bill 2007.  These amendments reflect the recommendations of the Uhrig review and align each agency’s governance arrangements with current best practice. This will ensure that administration of the recently announced government funding for AIMS, ANSTO and CSIRO for the next quadrennium—the largest ever research budget—will be efficient, effective and accountable. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.