Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I table a supplementary explanatory memorandum relating to the government amendments to be moved to the Asset Recycling Fund Bill 2014.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I have a suggestion that may assist our progress. Given that the opposition is supporting all of the government's amendments, I am offering the minister the opportunity to move them together. I am not sure if the Greens have an alternative view, but I am offering that opportunity.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

In speaking on behalf of the Australian Greens, I am happy, Senator Cormann, if you want to move government amendments en bloc. The Greens will be supporting them all.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

by leave—I move government amendments (1) to (21) on sheet HT101:

(1) Clause 2, page 1 (line 9), omit "1 July 2014", substitute "the day after this Act receives the Royal Assent".

(2) Clause 4, page 3 (lines 30 and 31), omit "Financial Management and Accountability Act 1997", substitute "Public Governance, Performance and Accountability Act 2013".

(3) Clause 4, page 4 (lines 24 and 25), omit "Financial Management and Accountability Act 1997", substitute "Public Governance, Performance and Accountability Act 2013".

(4) Clause 8, page 9 (line 1), omit "appropriate", substitute "permissible".

(5) Clause 8, page 9 (line 3), omit "powers", substitute "power".

(6) Clause 12, page 11 (lines 10 to 12), omit "Special Account for the purposes of the Financial Management and Accountability Act 1997", substitute "special account for the purposes of the Public Governance, Performance and Accountability Act 2013".

(7) Clause 12, page 11 (lines 13 to 17), omit "Special Account" (wherever occurring), substitute "special account".

(8) Clause 13, page 12 (line 5), omit "On the commencement of this section", substitute "At the start of the 28th day after this section commences".

(9) Clause 13, page 12 (line 17), omit "On the commencement of this section", substitute "At the start of the 28th day after this section commences".

(10) Clause 16, page 15 (lines 16 and 17), omit the note, substitute:

Note: See section 80 of the Public Governance, Performance and Accountability Act 2013 (which deals with special accounts).

(11) Clause 17, page 17 (lines 13 and 14), omit the note, substitute:

  Note: See section 80 of the Public Governance, Performance and Accountability Act 2013 (which deals with special accounts).

(12) Clause 21, page 19 (line 22), at the end of subclause (2), add "The State or Territory must comply with any such terms and conditions.".

(13) Clause 22, page 20 (lines 2 and 3), omit "Special Account for the purposes of the Financial Management and Accountability Act 1997", substitute "special account for the purposes of the Public Governance, Performance and Accountability Act 2013".

(14) Clause 22, page 20 (lines 4 to 8), omit "Special Account" (wherever occurring), substitute "special account".

(15) Clause 23, page 20 (lines 14 and 15), omit the note, substitute:

  Note: See section 80 of the Public Governance, Performance and Accountability Act 2013 (which deals with special accounts).

(16) Clause 27, page 22 (line 12), at the end of subclause (2), add "The person must comply with any such terms and conditions.".

(17) Clause 28, page 22 (line 26), at the end of subclause (2), add "The person must comply with any such terms and conditions.".

(18) Clause 34, page 26 (line 23), omit "On the day that this section commences", substitute "On the 28th day after this section commences".

(19) Clause 34, page 27 (line 14), omit "On the day that this section commences", substitute "On the 28th day after this section commences".

(20) Clause 35, page 28 (lines 17 and 18), omit "Section 39 of the Financial Management and Accountability Act 1997", substitute "Section 58 of the Public Governance, Performance and Accountability Act 2013 (which deals with investment by the Commonwealth)".

(21) Clause 47, page 36 (lines 26 to 28), to be opposed.

The Asset Recycling Fund Bill 2014 and the Asset Recycling Fund (Consequential Amendments) Bill 2014 establish a new fund as a vehicle for providing financial assistance and incentives to states and territories to invest in infrastructure. The new fund is necessary, as I have just said in my summing up speech, to support the government's asset recycling initiatives. The amendments being introduced by the government are primarily a necessary consequence of delays to the passage of the bill through parliament. Amendment (1) revises the commencement date from 1 July 2014 to the day after the bill receives royal assent. This will ensure that the parliament does not pass legislation that has retrospective effect.

Amendments (2), (3), (6), (7), (10), (11), (13) to (15), (20) and (21) are minor amendments taking into account that the Public Governance, Performance and Accountability Act 2013 took effect on 1 July. Amendments (4) and (5) clarify the Commonwealth can only make payments where it is permissible to do so under its executive power. These amendments provide clarity on what the government has the power to do under the Constitution. They ensure that this government and future governments cannot do anything under the bill that is inconsistent with this power. Amendments (8), (9), (18) and (19) ensure the Future Fund board of guardians has sufficient time to transfer $5.9 billion of uncommitted balances from the Education Investment Fund and the Building Australia Fund to the Asset Recycling Fund. Amendments (12), (16) and (17) ensure that the recipients of incentives and contributions towards large-scale infrastructure, including states and territories, are bound by the terms and conditions of the agreements under which funding is provided. The amendments strengthen accountability requirements that provide taxpayers with further confidence that funding is used for purposes allowed under the proposed legislation.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Labor do not oppose these amendments. These amendments are just dates of effect, correcting new legislation and make miscellaneous minor amendments to the bill. Once again, we note the government is being forced to amend its own bill.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

There is always a sting in the tail, isn't there? If the bill had been properly drafted in the first place, we would not be here. Nonetheless, as far as the Australian Greens are concerned, while opposing the entire intent of the bill and the thinking that underlies it, these amendments are technical and largely administrative in nature. I think Senator Cormann has reflected accurately their intent and the Greens will not be opposing them.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Before putting the question, I advise that amendments (1) to (20) will be put and then amendment (21) will need to be put separately. The question is that amendments (1) to (20) moved by Senator Cormann be agreed.

Question agreed to.

The TEMPORARY CHAIRMAN: The question now is that amendment (21) moved by Senator Cormann be dealt with. The question is that clause 47 stand as printed.

Question negatived.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

by leave—I move opposition amendments (1) to (6) and (14) to (17) on sheet 7486:

(1) Clause 4, page 4 (lines 16 to 18), omit the definition of Education Investment Fund.

(2) Clause 4, page 4 (lines 19 to 21), omit the definition of Education Investment Fund Special Account.

(3) Heading to subclause 13(1), page 12 (line 4), omit the heading.

(4) Clause 13, page 12 (line 5), omit "(1)".

(5) Clause 13, page 12 (line 14), omit "subsection 34(1)", substitute "section 34".

(6) Clause 13, page 12 (lines 16 to 28), subclause (2), to be opposed.

(14) Heading to subclause 34(1), page 26 (line 19), omit the heading.

(15) Clause 34, page 26 (line 21), omit "subsection 13(1)", substitute "section 13".

(16) Clause 34, page 26 (line 26), omit "subsection 13(1)", substitute "section 13".

(17) Clause 34, page 27 (lines 10 to 31), subclauses (4) to (6), to be opposed.

The focus of my remarks is around the issue of the somewhat ill-advised proposal to abolish the Education Investment Fund. I find it an extraordinary proposition that the government is seeking to do this, given the claims about the Prime Minister's obsession with infrastructure. We would all surely agree that infrastructure is critical to securing the future of the nation, but I would have thought that infrastructure would also include investments in our science and research and at our teaching facilities at our universities, at the CSIRO and TAFE colleges.

This proposition goes to the very heart of that. These institutions, of course, are where we find the new technologies that we need to ensure that we are able to generate the economic and social benefits not just now but well into the future. That depends upon the capacity of the Commonwealth to invest. The abolition of this fund would prevent that. I am very surprised that the government should try to slip this through as being part of the arrangements for this bill. Upon reflection, I can nonetheless understand, given the government's deep antipathy to higher education. It is in that context, I suppose, that it fits with the government's mentality when it comes to the removal of the Education Investment Fund. It is another broken promise. This is exactly the opposite to what the Liberal Party said during the last election. Senator Mason was quoted in The Australian newspaper before the election as saying:

We would seek to reinvest and rebuild EIF back to its former state wants the budget is back in surplus. This is a nation-building fund and the coalition intends to restore it as such.

Of course, this could be nothing further from the truth in terms of what has actually happened with the proposal contained in this bill. I would have thought that we would have heard more from the Liberal Party itself about this act of blatant vandalism towards the higher education system in this country. I have enormous regard for Senator Mason. I think it is a great tragedy that he is not engaged in the higher education sector in this government. Of course, the obvious point that is so often made in political comedy or farce is that as soon as you actually know something about a particular field it is not surprising that governments seek to move politicians out of that field. Senator Mason certainly fits that category.

The opposition amendments provide the opportunity for this chamber to reconsider this very, very rash decision. The amendments would save the Education Investment Fund. Our amendments do so because the Education Investment Fund provides the funding for the very projects that we need to develop the infrastructure in higher education research and vocational education. If the government succeeds in abolishing the fund, serious questions must be raised about its long-term commitment to investment in these areas. It is clear that the Asset Recycling Fund will not be available for investments in those areas. Is a perverse outcome, because 59 per cent of the funding for the Asset Recycling Fund comes from education. What an extraordinary proposition: research infrastructure which is so vital to the future economic and social health of this nation is being used to fund privatisation of assets.

I note the Australian Technology Network, the group that involves a number of very respected institutions—QUT; RMIT University, in my home state of Victoria; the University of Technology, Sydney; the University of South Australia; Curtin University—has raised concerns. In their submission to the Senate inquiry into the bills they state:

The ATN is concerned about the continuation of research infrastructure funding from 2015 and the lack of guidance in the Bill as to how future research related infrastructure projects will be prioritised for funding via the ARF.

The Australian Technology Network of universities went on to say that the coalition election policy stated that the coalition was in the business of:

… building a world-class Education and Research sector

This bill could be nothing further from that. It notes the statement in which the coalition government pledged that it would:

… encourage modernisation and the development of world-class Education and Research capabilities and support the use of new technologies, particularly digital and IT.

This bill could be nothing further from that. This government attacking the agencies that could deliver on such an election commitment, such as Australian universities, CSIRO, and NICTA. This is exactly the sort of thing I suppose we could relate back to what the Prime Minister said when he said that we 'should judge him on his performance'. His performance in this matter is abysmal. The ATN also noted:

The provision of modern research capabilities comes at a cost. To date 71 infrastructure projects have been funded by EIF to the sum of $2.4 billion. This included $643m in funding for pure research infrastructure …

The ATN submission also raise concerns about the removal of the remaining research funding mechanisms:

Therefore following the removal of EIF the remaining research funding mechanisms, including research block grant funding, are not sufficient to create world class research infrastructure.

It strikes me that this is a pretty fair point. You take this money away and what are we going to use to fund the necessary research infrastructure in this country? How are we going to be able to fund the work that CSIRO does in terms of research infrastructure, the work of the universities, the work of the other science agencies?

I might emphasise that I have got a bit of an interest in this matter, because when I was the minister the fund operation placed particular importance on proper administration by an independent board. It was not a pork-barrelling exercise, as we have seen with this government in its attempt to use Australian Research Council funding. It was not done in any way other than on a competitive basis—on the basis of an evaluation of projects under very rigorous criteria. There were over four funding rounds and 71 projects were supported. They were projects on university campuses, TAFE campuses—projects supporting major scientific infrastructure. They were projects like these: the Science and Engineering Precinct in Ballarat, now at the Federation University; the Science Place for northern Queensland at James Cook University; the Indian Ocean Marine Research Centre at the University of Western Australia; the University of Tasmania Institute for Marine and Antarctic Studies; the University of Adelaide's Institute for Photonics and Advanced Sensing; the Latrobe Rural Health School in Bendigo; the University of Western Sydney Centre for Climate Change and Energy Research.

I note that on Tuesday—and this is a particular irony—the Minister for Industry was at Mount Stromlo launching another project that was funded through this fund. The project is, of course, the Advanced Instrumentation and Technology Centre. And I will seek leave to table the minister's press statement from Tuesday because it will highlight the sorts of infrastructure projects that are funded by this government which, of course—I must say that the minister was at least gracious enough to acknowledge that the funding had actually been provided by a Labor government.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

By you.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

I won't be so crass, Senator!

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

That is a first!

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

But I will suggest that it is quite unusual for this government to acknowledge the work that we did in regard to the provision of basic infrastructure and, particularly, in regard to the importance of the universities and scientific agencies. I quote from the media release:

Australian scientists have snared two world-leading contracts to make astronomical instruments which will further consolidate Australia’s reputation for global innovation, Minister for Industry Ian Macfarlane said today. The Australian National University’s Advanced Instrumentation and Technology Centre at Mount Stromlo has been contracted to design one of the first instruments for the Giant Magellan Telescope (GMT), a super-giant earth-based telescope being built in Chile that is set to revolutionise our view and understanding of the universe.

I understand the minister is happy for me to table that press release.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Is leave granted for Senator Carr?

Leave granted.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

I do that because it might help the minister understand the importance of these issues of which his colleagues obviously do appreciate. But it has not sunk in. This very principle of the importance of universities in Australia winning major contracts and providing the central thrust for our science and research effort in this country has just not registered. At the same time, of course, this is a government that the very next day seeks to debate in this chamber a proposal to abolish the fund that actually ensures that these sorts of projects go ahead.

Of course, it is not just the universities that will suffer. The Education Investment Fund has been a great benefit to the CSIRO. That may well be a problem for this government given the hostility this government has shown to the CSIRO. It may well be that this is yet another one of its cunning plans to do great damage to our scientific infrastructure. It was the fund that we used to actually provide the new deep-sea research vessel, the Southern Surveyor. Without EIF, this nation would be left without the capacity to carry out our marine and ocean research—our blue-water research capacity.

The minister has appointed a working party to look at this. There have simply been no answers to the way in which we can ensure future funding arrangements, unless there is provision made—you actually have to do something and not just have good intentions or just make an assertion that you are interested when all of the evidence and all of the facts point to exactly the opposite.

The last budget that this government brought down highlighted its intentions. It was where it put its actions on the line rather than its statements. We saw during the election campaign that commitments were being made which are clearly being breached. This is yet another example of the way in which commitments that this country so desperately needs—to ensure that our universities are able to sustain their capabilities and to ensure that our universities are not placed in the position that they cannot provide the capabilities that we need to ensure the prosperity for this country—are being breached.

I know that the real opportunity for the government here is to allow this bill to go through in its full, which will in turn lead to the universities having to undertake even more drastic actions in regard to the privatisation of their efforts. The consequences are simple: this is a country that will be poorer as a result of this government's policy positions. That is why it is so critical for us in this Senate to weigh up carefully what is being said to us by this government, to reject the proposals that the government is making and to support the amendments. Because, without systematic and sustained funding in our research infrastructure, this nation will not be able to prosper and Australia will not be able to attract the very best and very brightest in the world. That is what we are doing with the investments that we are making in terms of our long-term commitment to research into commercialisation of research.

The abolition of the Education Investment Fund is an ill-considered decision by a government that does not understand the consequences of treating the research community in this way. You simply cannot treat the research community in a way of just turning on and off the tap of government support. That is why these amendments are being moved. This government's proposal is a demonstration of a wilful neglect to the fundamental principle of being able to provide this country with the necessity of ensuring that our universities, our scientific agencies and our TAFE colleges have the funding support they need to be able to provide the basic infrastructure they need to be able to ensure that this country is able to maintain its prosperity. I urge all senators to support these amendments.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

Mr Temporary Chairman, I made an error before—I was not seeking a separate vote on the particular items that have been moved here. I do want it recorded that the intention of items (1) to (6) and (14) to (17) on sheet 7486 is to prevent the government from transferring $3.5 billion from the Education Investment Fund into the Asset Recycling Fund. I believe that this should be opposed. I intend to oppose it. The purpose of the amendments is essentially to restrict the amount of funds available to promote privatisation and to place limits on the types of infrastructure that the Commonwealth is promoting. I intend to vote against this. I will, however, vote in favour of another section of Senator Conroy's amendments, subject to it being amended by my amendment.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

I will provide some comments on behalf of the Australian Greens. We support the Labor amendments that Senator Conroy foreshadowed and Senator Carr has just spoken to. The idea that the Australian government would effectively sneak through the abolition of a $3½ billion education and research fund for university and research infrastructure projects beggars belief. To bring it forward under the rubric of 'privatise everything' and at the stroke of the pen knock over $3½ billion worth of university and research infrastructure work is extraordinary.

The EIF is one of three nation-building funds, along with the Building Australia Fund and the Health and Hospitals Fund. It was established to build a modern, productive and internationally competitive Australian economy by supporting world-leading, strategically focused, infrastructure investments that will transform Australian tertiary education and research. What part of that statement is offensive to the Liberals and the Nationals? How could you conceivably come in here and gut funding for something that had that as its intention? How can you then front press conferences day after day talking about innovation, economic growth and strength and staying at the forefront? What century is it that you are try to keep us in?

As a result of the Commission of Audit on the future use of nation-building funds—and I guess without too much surprise: you commission these reports and they will give you what you expect in large part—the government announced that the EIF would be axed, that no further funding rounds would be held and existing projects would continue to be funded, but basically it turned off the funding tap for such an important fund.

One of the reasons that the Greens are strongly in support of the amendments and strongly defend the EIF is the kinds of projects and work it has been funding. When you look at those you realise exactly why it is that the coalition loathes it so much. The EIF supports clean energy research infrastructure. It provided $4 million to the University of Queensland to build research infrastructure to support the AGL Energy Photovoltaic Solar Flagship. There we go! That starts to give us a bit of an idea of why the coalition might hate it. It has the words 'energy efficiency' in it, it has the word 'solar' in it, therefore wipe it out. The EIF regional priorities round funded 10 projects, including Creative Futures Tasmania and advanced design and engineering training in Victoria. Round 3 included the EIF sustainability around. Oh, another word that the coalition cannot abide! Anything with the word 'sustainability' in it is being abolished as well. Nineteen projects were approved for funding across tertiary education and research sectors, including the advanced manufacturing centre at Swinburne University and the Indian Ocean Marine research Centre at the University of Western Australia. Why would we need people to be researching oceanography? Get rid of that. Central Tech Green Skills Training Centre at Central TAFE in WA? Yes, absolutely—the word 'green' is in that one. The University of Wollongong's Retrofitting for Resilient and Sustainable Buildings? Obviously that is the kind of thing that the Liberal and National parties hate. The Greens strongly support these Labor amendments and commend them to the chamber.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

On behalf of the government I indicate to the chamber that we will not be supporting these amendments. These amendments seek to prevent the government from transferring, as Senator Leyonhjelm indicated, $3.5 billion in uncommitted funds from the Education Investment Fund to the Asset Recycling Fund. Without the proposed transfer from the Education Investment Fund, the Asset Recycling Fund will not be viable for the purposes for which it is being established. The proposed transfer, as I have indicated, relates only to uncommitted funds in the Education Investment Fund—that is, amounts for which no projects have been either approved or identified. The government will meet commitments to projects already previously approved for funding from the Education Investment Fund, including those approved by the previous government. These projects will not be affected by the transfer of uncommitted amounts to the Asset Recycling Fund.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

The question is that amendments (1) to (5) and (14) to (16) be agreed to.

The Senate divided. [14:01]

(The President—Senator Parry)

Question agreed to.

Progress reported.