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ENVIRONMENT, COMMUNICATION, INFORMATION TECHNOLOGY AND THE ARTS LEGISLATION - 25/05/2000 - NATIONAL OFFICE FOR THE INFORMATION ECONOMY

ACTING CHAIR (Senator Tchen)—If the officers from the Office for the Information Economy are available, we will proceed with that. You represent the information technology area of the department?

Dr Badger —Yes. There is the National Office for the Information Economy, the IT industry policy area and the Office of Government Online. I will do two.

Senator LUNDY —I am happy to start with the National Office for the Information Economy. The resources for that office are part of the department's expenditure. Can you isolate for me what the allocation for the National Office for the Information Economy is for this coming financial year? If you can point out to me a figure in this document I would be most appreciative.

Dr Badger —If we go to page 36 and outcome 2—contributing outputs, then output 2.3, down at the bottom of the page, that is the output under which the resources of the National Office for the Information Economy are or to which they are ascribed. As you may remember, the national office was originally established in 1997 with a three-year time frame and a certain amount of resources for new activities. Since then it has been augmented within the department by a series of departmental functions—for example, the international area, which was formerly in the department, and also activities that came from the former industry department in terms of online commerce type activities and the Information Technology Online program that used to be in ISR. They are now all within that $15 million that is identified there under that output.

Senator LUNDY —What was the budget for the last financial year? Is there a previous years and forward years estimate for that output?

Dr Badger —On page 41 you will see under departmental appropriations, output 2.3 - Strategic advice, programs and policy to advance Australia's participation in the global information economy. That is the output to which the augmented national office contributes. The budget estimate for this financial year is $15 million and for the last it was $10 million. The difference between the two is primarily explained by a difference in the way that the carryover from one year to another is treated.

Mr Clark —There are a number of elements to this. That is certainly the explanation. It seems to be an inherent increase. Part of it is explained by an item on page 65. There is an item up the top in estimated actual 1999-00 appropriation prior year, code 426334. This was cash appropriated in the cash environment where we changed to accruals in the following year. The cash was appropriated in the previous year and rolled over until the following year. DOFA's guidelines were that we could not count that twice in both years. It had been appropriated the previous year, so it was required to be included as a capital item in this year. That meant it could not be counted as revenue. In terms of resources devoted between the two years, the resources devoted in the previous year were not $10 million. They were in excess of $10 million. The comparison is not a significant increase because the capital sum is effectively treated as resources by NOIE and used accordingly internally within the department but treated as capital by DOFA. We have had some difficulty explaining this even internally within the department.

Senator LUNDY —Yes, I can see why with all due respect.

Mr Clark —I am sorry to inflict that on you.

Senator LUNDY —What is the difference after taking out all of that carryover and the counting of money as capital for the purposes of this year's budget.

Dr Badger —If I describe it in terms of the amount of staffing resources in general terms, the resources we expect to have—

Senator LUNDY —That was my next question. What does this mean in terms of bodies?

Dr Badger —There is little change between the available resources for next year as opposed to this financial year depending on decisions about internal departmental re reframing priorities.

Senator LUNDY —Are there the same number of people employed this year?

Dr Badger —At this stage we are working on a staffing number very close to the same for this financial year and the next financial year.

Senator LUNDY —Can you take that on notice to provide me in as clear a way as conceivably possible what you have just explained to me in two minutes here?

Mr Clark —Yes.

Senator LUNDY —Thank you. That might save a bit of time. I suspect I could spend the next half an hour here and probably not understand it fully. In terms of the actual structure of NOIE, we have previously gone through the number of employees. But just for my benefit now, because that will lead to other questions, Dr Badger, can you just run through those areas that NOIE now covers and where they have come from?

Dr Badger —Prior to 1997, there was a branch in the department that dealt with the start of the government work on Online activities. That was augmented by an amount of new money with the establishment of NOIE. That was when NOIE was more independent of the department. After the last election, among the reorganisations that took place, the government moved NOIE inside the department, effectively as another division, and added to it the international branch, which was previously part of telecoms, and also at that time, as you would remember, there were a number of IT industry development functions that came from the industry department. Of those, those that were devoted to the online environment were moved into NOIE. There was a task force, I think it was called the Information Industries Task Force, in the industry department. That had two basic functions. One was traditional IT industry development and the other was a smaller group that looked at the promotion of information online activities to business. They ran a program called information technology online, and that second group was associated with the other activities within NOIE. The other group, of course, the traditional IT industry development activity, became the basis of discussions we have had before about the Information and Communications Industry Division, which is the one that deals with traditional industry policy.

Senator LUNDY —What about the BITS program?

Dr Badger —The BITS program is managed not by the national office but by the Information and Communications Industry Division, which is the group that we have discussed purchasing or outsourcing.

Senator LUNDY —So the industry development aspect within NOIE was the information industries task force?

Dr Badger —Yes, they were part of that. The department has always had a general interest in the take-up of Online and promoting the benefits of Online to industry in general, but there was a more specific program oriented activity within ISR which, after this last election, came into the department, into NOIE.

Senator LUNDY —Does NOIE administer anything to do with the RTIF?

Dr Badger —No, I do not think so.

Senator LUNDY —Does NOIE administer any grants programs?

Dr Badger —The Information Technology Online Program, which is a small granting program that is designed to improve the take-up of—

Senator LUNDY —Does that includes Accessibility?

Dr Badger —No, the Accessibility program at one stage, I think, was originated from within NOIE and was then transferred as a program administration activity to the Networking the Nation or the RTIF program.

Senator LUNDY —There was another, I think it was the OPAI.

Dr Badger —Yes. That was one of the original programs. You are starting to test my memory—

Senator LUNDY —I am testing my own.

Dr Badger —I think that was actually handled when the national office was first established in 1997-98. I think it lasted for two years. That program is now well and truly finished, but I think it was administered there. That was early on, before the department had significant program activities. We have tended to draw our program activities in the one place to obviously get the benefit of the skills of the program management that is there.

Senator LUNDY —Turning to the future of NOIE, you mentioned that it was originally budgeted for a three-year period.

Dr Badger —Yes.

Senator LUNDY —The original budget would have been 1998-99.

Dr Badger —It was. The three-year resources would have run out this financial year, 1999-2000. If you look at the budget papers, there is an initiative which is about the continuation of the funding of NOIE.

Senator LUNDY —Can you tell me which page, please?

Dr Badger —It is page 40.

Senator LUNDY —Previously, NOIE did get a line item budget allocation, did it not?

Dr Badger —Not in the same way as an independent agency. The money has always been associated with the departmental vote.

Senator LUNDY —I know that. Certainly around the establishment of NOIE, there was a lot of discussion and a little controversy about its status within the department and who got to run it and who was answerable to whom. What constitutes the identity these days of NOIE within the department? What makes the actual structure within the department different and special with these changes to financial arrangements? Anything?

Dr Badger —We have retained the branding, if you like, of the National Office for the Information Economy. For administrative purposes, it operates within the department. So we get, if you like, the benefit of the economies of scale of working within a large organisation.

Senator LUNDY —And that has changed in the last—

Dr Badger —After the last election, that was the change—bringing it closer for administrative purposes to the department. We have the branding. There is the NOIE web site activity. We have maintained separate accounts. As you have seen in this, there is a particular output which basically covers the NOIE activity. The activities that have been brought together with NOIE were ones in the department which were judged to have a large amount in common with a lot of the objectives that NOIE was originally given—for example, the international activity.

Senator LUNDY —I am just trying to establish what NOIE's structure is these days. You kind of answered it by saying that you have retained the branding, but everything else is operating within the department per se—which is different from how it was before.

Dr Badger —The government made a decision to make a change after the last election.

Senator LUNDY —Was there any public announcements made to that effect?

Dr Badger —There was a press release which, at the same time, covered the change from there being a board. There was NOIE board, as you might recall.

Senator LUNDY —Yes.

Dr Badger —That became linked with the former IT industry advice function within ISR and became the Australian Information Economy Advisory Council.

Senator LUNDY —The AIEAC?

Dr Badger —That is right.

Senator LUNDY —So, at that point in time, NOIE kind of lost its separate identity in terms of its structure. What was Paul Twomey's position called prior to 1998? How did these structural changes impact upon his position, and who is he answerable to within the department?

Dr Badger —Paul Twoomey was and still is Chief Executive Officer of the National Office for the Information Economy. As part of the changes that took place, he was provided a role with more concentration on international activities and an international investment promotion role. I am not absolutely sure, but I think somewhere in his official title of CEO of NOIE is Special Adviser, IT Investment—something of that order.

Senator LUNDY —What were his roles in managing and directing the elements of NOIE that you have described?

Dr Badger —Prior or now?

Senator LUNDY —Now.

Dr Badger —Paul is responsible, in conjunction with the secretary, with the overall strategic direction that NOIE takes. For practical reasons, because of the emphasis of the international activity he does, the day-to-day running of NOIE rests with the deputy chief executive officer and the chief general manager.

Senator LUNDY —Who is that?

Dr Badger —The chief general manager is Jenelle Bonnor.

Senator LUNDY —So he does not manage it.

Dr Badger —I think he would probably describe it differently, but effectively Paul is involved in ensuring that day-to-day management activity takes place, but his emphasis is on the strategic role. You will be aware that he is involved in a considerable number of international committees and for practical reasons that is where he concentrates.

Senator LUNDY —But for practical purposes he is not managing NOIE.

Dr Badger —He is not doing the hands-on management of the Canberra environment, for example.

Senator LUNDY —What about the Sydney environment?

Dr Badger —If he is there, then I presume he is more across what happens in Sydney.

Senator LUNDY —In terms of who he is answerable to, my understanding was that initially Paul Twomey, as CEO of NOIE, worked to the minister as opposed to the departmental secretary.

Dr Badger —He still does. He still works directly to the minister.

Senator LUNDY —You said in conjunction with the secretary on matters relating to NOIE.

Dr Badger —The way the secretary and Paul work on things is really a matter for the two of them.

Senator LUNDY —What is he classified as for the purposes of remuneration?

Dr Badger —His appointment?

Senator LUNDY —Yes.

Dr Badger —He has a statutory appointment. It is under section 67 of the Constitution which is very similar to something else. His remuneration is determined by the remuneration tribunal.

Senator LUNDY —Is that standard for someone whose practical endeavour is involved in international policy work and not managing anything?

Dr Badger —I could not comment.

Senator LUNDY —I wish a minister was here. Perhaps a minister would be able to comment. I will ask the minister when he arrives what he thinks of that situation. Who is located at the Sydney office now?

Dr Badger —The best way to say it is that the there was an awareness raising activity function undertaken there primarily to run the Online Australia year.

Senator LUNDY —Which year was that?

Dr Badger —Last year—1999 on the calendar. You will have to forgive me. I was here at the start and I have only just come back. Even three years disappears.

Senator LUNDY —You are forgiven, at least by me.

Dr Badger —Thank you.

Senator LUNDY —When NOIE was originally established, wasn't it given space up there in Sydney? Weren't they located up in Sydney?

Dr Badger —There is certainly space up there and we still have that. It housed the CEO and the group that was running this awareness program.

Senator LUNDY —I guess my point was that the space was leased prior to that awareness program, was it not?

Dr Badger —I cannot recall now the precise nature of the lease. Certainly, when the additional funding for NOIE was announced, it was said that it would have a presence in Sydney as a major business centre, and that the CEO would be located there.

Senator LUNDY —When was that announcement made? I am sorry, I am getting confused.

Dr Badger —In 1997.

Senator LUNDY —It was late 1997, wasn't it, when NOIE was launched?

Dr Badger —The announcement of NOIE being established was in 1997, and I am not too sure but I think in early 1998 there might have been another statement about the CEO—

Senator LUNDY —It took about four months, from memory, for that to bed down.

Dr Badger —There was a period between the announcement and the appointment of the CEO.

Senator LUNDY —Quite a long period from memory. So they established premises in Sydney?

Dr Badger —Yes.

Senator LUNDY —What was the duration of the lease—firstly, I presume they are still in the same premises—and what was the duration of the lease and the cost?

Dr Badger —I will have to take the details of the lease and the cost on notice.

Senator LUNDY —I am actually quite interested in those details, so if you could give me some on the location and floor space and so forth—

Dr Badger —Yes, certainly.

Senator LUNDY —How many people were located in Sydney during 1999 Online year?

Dr Badger —We had provision, I think, for six or seven people whose function at that time was to run that program. The idea was not that NOIE was establishing a presence in Sydney.

Senator LUNDY —That was certainly in the gist of the minister's announcement.

Dr Badger —And it is still our intention to maintain a presence in Sydney. The precise nature of that presence we are discussing at the moment for the future.

Senator LUNDY —So you have not resolved it yet?

Dr Badger —No.

Senator LUNDY —How many people are located in the Sydney premises at the moment?

Dr Badger —I think at the moment there are probably only four. We are going through a changeover of staff. As the awareness program comes to an end a number of people who were most associated with that have decided to move on.

Senator LUNDY —Didn't that come to an end at the end of 1999?

Dr Badger —The Online Australia year was 1999 but there certainly was funding for the staffing to continue because the staff were a part of the basic NOIE establishment and they were doing this particular program which was given resources to carry out the awareness activity. So the fact that the program money effectively had stopped did not mean that the staffing—

Senator LUNDY —Where are the rest of NOIE located?

Dr Badger —In Sydney Avenue in the department's building on the second floor.

Senator LUNDY —How many people are located there?

Dr Badger —I think it is about 70 because it has got the international people and the people came from ISR.

Senator LUNDY —How do you justify maintaining an office in Sydney—and I understand it is quite a nice office with quite a nice view—with four people in it?

Dr Badger —The number of people in it is a temporary phenomenon. As I said, a number of people—

Senator LUNDY —How long has it been temporary though? It is now May.

Dr Badger —I think if we go back to March/April there were probably six or seven people there.

Senator LUNDY —What were they doing?

Dr Badger —There were still a number of the finalisation things to do with the Online Australia period.

Senator LUNDY —Four months after the initiative finished—come on!

Dr Badger —In addition to the leftover from the Online Australia program there were people there who worked with people in Canberra on particular projects, particularly those associated with links with small and medium enterprises and business activities.

Senator LUNDY —Like what?

Dr Badger —They worked on—here we go!

Senator LUNDY —Feel free to bring more officers to the table.

Dr Badger —Yes. There is a series of programs—the Australian schools web channel, the women online web site, the establishment of particular web sites for particular people. These things were started during the Online Australia year and there was funding to maintain them for some time after that. There were people working on, for example, issues to do with venture capital. There was a chap working on things to do with tax. I will have to get you the run-down of the work program.

Senator LUNDY —Were they doing policy work for the government?

Dr Badger —They were providing input to policy work for government.

Senator LUNDY —Could you provide me details of what those people were engaged in and when they left so that I get a bit of a map of the dwindling numbers in the Sydney office over time?

Dr Badger —I shall indeed.

Senator LUNDY —How often is Paul Twomey there?

Dr Badger —I honestly do not know. Sometimes he is there for long periods of time. It depends on the international meeting schedules. For example, at the moment he is at the APEC TEL meeting, but then he will lead a delegation of Australian IT companies or online companies to North America. The amount of time he spends really depends on—

Senator LUNDY —Aren't they over there at the moment?

Dr Badger —There is a group that Davos people have there and Paul will join that. There is another group that is an Austrade group as well, but I think Paul—

Senator LUNDY —That is the one I am thinking of.

Dr Badger —No, that is a separate activity. Paul will move to join in the Davos activity.

Senator LUNDY —You mention that you are contemplating what comes next for the role of the Sydney office. Can you expand on that a little?

Dr Badger —When the government announced the establishment of NOIE, and particularly in the announcement of the appointment of the CEO, it pointed to the benefits of having an office which was to deal with the online economy, position where major IT and online companies were to enable that first-hand interaction with industry and to augment the policy and regulatory work that was being done out of Canberra.

Senator LUNDY —Does the minister spend any time in the office up there?

Dr Badger —I could not say. I know he has been there on any number of occasions but I do not know how often.

Senator LUNDY —Can you remind where it is? I have not actually been there.

Dr Badger —Australia Square.

Senator LUNDY —What floor?

Dr Badger —It is a fair way up—40.

Senator LUNDY —Floor 40 of Australia Square—nice view of the harbour. Have you been there?

Dr Badger —I have to say I have and—

Senator LUNDY —Does it have a harbour view?

Dr Badger —I have to agree with you about the view, yes.

Senator LUNDY —Is it a harbour view?

Dr Badger —It all depends on which office you look out of.

Senator LUNDY —Does it cover the whole floor?

Dr Badger —No, it does not cover the whole floor; it is on a corner.

Senator LUNDY —How much of the floor does it take up?

Dr Badger —You asked for the floor space details and I will provide those.

Senator LUNDY —And the orientation.

Dr Badger —I am sure we can provide that.

Senator LUNDY —It sounds very glamorous indeed. The point of all of this is: are you able to justify sustaining that presence in the central business district of Sydney?

Dr Badger —As you would expect, that is what we are doing in this assessment.

Senator LUNDY —Are there any plans to change the number or again restructure NOIE or what is the remnant structure of the original NOIE?

Dr Badger —There is nothing, apart from the resources and functions that we do out of Sydney.

Senator LUNDY —In terms of the policy work done by the National Office of Information Economy, the international policy area is something that I have been through previously. With respect to AIEAC, can you tell me what budget allocations are associated with the operation of that council?

Dr Badger —We may have to take that on notice.

Mr Kennedy —The budget allocation comes within the resources made available to the NOIE activity, so we have flexibility. I understand that of the order of $500,000 is devoted to the activities of AIEAC.

Senator LUNDY —Per annum. Is that a combination of secretarial support and remuneration for council members?

Mr Kennedy —For both. That allocation that we just mentioned was for this financial year. The next financial year's one will be somewhat lower—just over $300,000.

Senator LUNDY —Why is that?

Mr Kennedy —Because we restructured the operations of AIEAC, and in particular streamlined the operation of AIEAC subcommittees so that most of the work—

Senator LUNDY —Does that mean you ditched some?

Mr Kennedy —Yes. They were wound up. That is right.

Senator LUNDY —Which ones?

Mr Kennedy —For example, the NBI subcommittee.

Senator LUNDY —What does that mean?

Mr Kennedy —The national bandwidth inquiry subcommittee. It completed its work towards the end of last year and was wound up on that basis. So that has reduced travel and support expenses considerably.

Senator LUNDY —Have any other working committees been ditched?

Mr Kennedy —There was one which was providing some input to NOIE on the issue of innovation and another one which was providing input to the development of IT skills policy.

Senator LUNDY —The IT skills policy?

Mr Kennedy —Yes.

Senator LUNDY —So neither of those working groups have continued?

Mr Kennedy —That is correct.

Senator LUNDY —When was the decision made to cease their operation?

Mr Kennedy —It was at an AIEAC meeting, a meeting of the full council, late in December, about a week before Christmas. I cannot remember the exact date.

Senator LUNDY —Was that decision based on the funding arrangement that they were anticipating?

Mr Kennedy —No, not at all.

Senator LUNDY —It was based on their strategic operation?

Mr Kennedy —Exactly.

Senator LUNDY —With respect to that saving of some nearly $200,000, can the money be attributed to those three working groups or three committees?

Mr Kennedy —Yes, largely. The council is quite large. It is a comprehensive group and they live all around the country. Bringing them together is of course—

Senator LUNDY —I appreciate that there is some expense involved in that. I am just trying to get an idea of the proportion of that allocation that was actually used for those working groups. How often were the working groups or committees meeting?

Mr Kennedy —The national bandwidth inquiry subcommittee was meeting monthly, or even more often at times. The others met less often, but they probably met three or four times apiece.

Senator LUNDY —What working committees remain in place?

Mr Kennedy —There is one committee which was created at the last AIEAC meeting a couple of weeks ago to look at the issue of Australia's national competitiveness in electronic service markets and how we might market that overseas.

Senator LUNDY —It sounds quite specific. I think I have asked for minutes of AIEAC previously but perhaps you could take on notice the provision of minutes of AIEAC.

Mr Kennedy —I will take that on notice.

Senator LUNDY —And also full membership details and the period of appointment of current members and previous members. Can you tell me if the working groups are made up of additional people or whether the working groups or committees are constituted solely from full council members?

Mr Kennedy —To date, they have been constituted from AIEAC membership.

Senator LUNDY —Is that likely to continue?

Mr Kennedy —There is certainly nothing to prevent members other than council members being coopted but that has not been done so far.

Senator LUNDY —What sort of secretarial support and research support is offered to AIEAC in terms of their operations? Can they commission research and things like that?

Mr Kennedy —The preparation of papers for AIEAC meetings has so far exclusively been done in-house. The secretariat support for AIEAC consists of myself, one EL officer and an ASO3 executive assistant.

Dr Badger —I should add that the secretariat support is augmented by other resources from within the department depending on subject matter.

Senator LUNDY —Not just associated specifically with NOIE but all aspects?

Dr Badger —No. In some parts of NOIE, for example, if you are dealing with an issue to do with IT industry development—which gets within their mandate—we would have people from that part of the department assist. Mr Kennedy is right. They are the devoted resources, as he said.

Senator LUNDY —In terms of the reach of AIEAC across IT within DCITA, it obviously extends its role beyond just NOIE. How far reaching are their roles or terms of reference? I am trying to get an idea of the scope of AIEAC.

Dr Badger —Its role and functions were set out when it was announced. We can get you that press release. If you look at where it originated from, it was to bring together the advisory functions that were carried out in relation to IT industry development out of the industry department and the advisory role of the NOIE board that was part of the original NOIE 1997. It covers the IT information economy in its broadest sense from both traditional IT development and also the emerging online economy. Somebody has just reminded me of the bandwidth inquiry. The bandwidth inquiry was conducted by a subcommittee of AIEAC and it did commission some external consultancies.

Senator LUNDY —What involvement does NOIE have in issues relating to consumer law like email, spamming and stuff like that?

Mr Dale —You are asking about consumer policy issues on online matters, Senator. We have undertaken a number of joint initiatives with the Department of the Treasury where the government's main consumer policy function resides. They are targeted at, among other things, educating online or potential online consumers about basic question and answer type information. A series of fact sheets were issued between ourselves and Treasury over the last 12 months and widely distributed. We have also been involved in convening a number of industry discussion groups looking at issues such as—

Senator LUNDY —Why is Treasury involved?

Mr Dale —Because the Department of the Treasury is where the government's consumer policy function resides. The responsible minister is the Minister for Financial Services and Regulations, Mr Hockey, and there is a division within the Department of the Treasury responsible for consumer issues overall.

Senator LUNDY —Minister Hockey is talking about it.

Mr Dale —In relation to online consumer issues specifically, as I have said, we continue to undertake a number of initiatives jointly with that area of Treasury and we believe they have been quite successful. Consumer groups and others have participated. For example, a number of industry forums that we have convened are focusing on issues such as website, seals of approval, privacy safeguard guarantees, and things like that. We continue to work with Treasury on monitoring broader policy developments and it remains an area of some interest and concern to us given the general growth of e-commerce.

Senator LUNDY —Have you had any involvement in the development of the government's policy on privacy?

Mr Dale —We have worked with the Attorney-General's department which has had the main carriage for that policy, and the government has recently introduced legislation. Yes, we were part of the substantial consultative mechanism that the Attorney-General's department put in place leading up to the drafting of that legislation and we continue to liaise with them closely on it.

Senator LUNDY —You are in the NOIE area, aren't you?

Mr Dale —That is correct.

Senator LUNDY —In the e-commerce area?

Mr Dale —That is correct.

Senator LUNDY —So can you just give me an idea of the issues that you cover? We have already looked at consumer based issues. I guess that is a pretty big description but it has manifested itself in a couple of pointy issues about rights of electronic consumers. There is privacy—what else?

Mr Dale —Our responsibilities in our group within NOIE broadly cover legal and regulatory issues of a more general nature, not simply consumer based issues. There are issues of Internet access, consumer policy issues and, also, administration of more industry focused grants—programs such as the ITEL program that Dr Badger mentioned earlier and working with industry groups, particularly small industry, helping the e-commerce take-up. There is a very broad range of activities of which the consumer and regulatory issues are one part.

Senator LUNDY —Have you got involved in the Internet gambling issue at all?

Mr Dale —In the sense of my own money, Senator?

Senator LUNDY —I will spare you an inquiry into your personal habits—in relation to policy development?

Mr Dale —We have been involved in providing advice to the minister on the development of the government's policy on interactive gambling over the last few months or so. That has been an issue involving a number of agencies, as I think the government has made clear in the number of joint announcements between several ministers.

Senator LUNDY —In terms of the progress of that, I am just curious, I keep hearing the Prime Minister talking about it but not anybody else. Are you able to specifically outline what the government's policy is on Internet gambling?

Mr Dale —I think I can only point to what is on the public record and that has been placed on the public record by a number of joint announcements from Minister Alston and Minister Newman, and a number of additional comments, of course, have been made by the Prime Minister. Essentially, the government has indicated publicly and to the states and territories that it wishes to have a moratorium—a freeze, if you like—on any expansion of interactive gambling operations for a period of 12 months or so to enable—

Senator LUNDY —Have they specified 12 months?

Mr Dale —I think that time period has been raised in the Ministerial Council on Gambling but that was in April.

Senator LUNDY —Is it government policy that the moratorium go for 12 months?

Mr Dale —That is the proposal that has been put to the states and territories, but the government has asked state and territory ministers to respond on both the scope and other arrangements involving that moratorium. The minister has written to state and territory ministers. There has not yet been a response to that. The federal government would clearly take into account the responses of state and territory ministers when they come in.

Senator LUNDY —Has there been a time frame set on those responses?

Mr Dale —Not that I am aware of; they are still awaiting replies.

Senator LUNDY —So this moratorium, if the government were successful, could start anytime, depending on when the states and territories respond to the government?

Mr Dale —The final decision on the exact composition of legislation to enforce the moratorium has not been made by the federal government.

Senator LUNDY —Would a moratorium require legislation federally?

Mr Dale —The government has indicated that it is examining legislative options. Clearly that is one means of limiting services of an interactive gambling type for a fixed period. The government did, at the Ministerial Council on Gambling on the 19 April, invite state and territory ministers to adopt a voluntary moratorium, but state and territory ministers, with a number of exceptions, generally indicated they were not prepared to do that. The government has since announced publicly that it is considering options of legislation.

Senator LUNDY —Is it your job to prepare those options for legislation for the minister?

Mr Dale —Yes it is, among other advisers.

Senator LUNDY —Are you working on that at the moment?

Mr Dale —That is correct.

Senator LUNDY —When do you hope to have that finalised and delivered to the minister?

Mr Dale —That is something we will be raising with the minister in the very near future, but the government has indicated it wishes to press ahead as quickly as possible so we are responding as quickly as we can.

Senator LUNDY —On the implementation of such a moratorium, I am curious as to the operation of it. Is it your understanding that a moratorium would relate to stopping states and territories from licensing new online gambling operators? Is that the purpose of the moratorium?

Mr Dale —The focus would not necessarily be on the operation of what state and territory governments do. The focus is on the gambling services themselves and limiting any expansion of them. The government has not specifically said that it will legislate to deal with the licensing operations of a state government, for example; there are other ways that that might be done, but those options are still open to consideration by the Commonwealth government. The issuing of gambling licences of an online type is and remains a matter for the state governments, of course; but the Commonwealth's concern, again on the public record, is with the expansion of new services, so it may be that the legislation would focus on the issue of any new services for a fixed period, be it 12 months or whatever. As I have said, we are still awaiting comments or further feedback from state governments on that aspect and, indeed, any aspect of the proposed legislation before a final decision is made.

Senator LUNDY —I am curious about not wanting further expansion. What are the legislative tools available to restrict expansion if you cannot actually legislate to inhibit the states from issuing new licences? Is it some sort of legislative mechanism saying that existing operators cannot make their sites bigger, or is it saying that the existing sites online must be rendered inactive or taken down during that period of time? What is your interpretation of the government's policy? I am sorry, that is not a very fair question.

Mr Dale —It is not up to me to interpret the government's policy.

Senator LUNDY —No, it certainly is not up to you to interpret it. But can you see what I am getting at: what does it actually mean?

Mr Dale —I can only say that at the moment, because the final legislative form, if any, has not been decided on by the government, I really cannot comment on the best option that there might be. The basic issue is one of the Commonwealth's powers in regulating telecommunications and like services; and the issue then is one of regulating those services in the same manner as telecommunications and broadcasting services are regulated for a whole range of other purposes, rather than gambling licences as such. The issue is services which happen to provide gambling or other features over a telecommunications network.

Senator LUNDY —Effectively, they are operating within the same legislative constraints as they did for managing online content of sexually explicit material?

Mr Dale —There are some similarities, certainly with regard to the heads of power and the general legislative approach that the government might take. In the case of interactive gambling, the government has gone one step further because of the existing base of state legislation and state licensing and, for that reason, has involved state governments to a much greater extent than other areas where the Commonwealth has had exclusive power.

Senator LUNDY —To explore those similarities, my understanding is that it is almost a constitutional constraint on the Commonwealth on regulating content per se, and that was the reason they chose the path they did with the online services bill. The government could not regulate the content per se or mandate the classification of online content and the mechanism was used to look at their powers under the Telecommunications Act. So it had to relate to the transmission of this material. You are looking at the same approach for a moratorium for online gambling. Doesn't that mean that the contemplation of legislation in that area is similar to regulating the Internet as opposed to regulating the Internet for the purposes of stopping access to certain content rather than regulating the content itself?

Dr Badger —We are getting into the realm of discussing the types of advice we are likely to be putting together.

Senator LUNDY —I am just trying to get it clear in my mind, Dr Badger.

Dr Badger —Almost by definition, Mr Dale will be canvassing the types of approaches that could be taken to implement the approach that the government has announced. I think that will make it very difficult for us to provide advice without getting into the realm of commenting on the approaches to policy. They are the things I think would be far better taken up with the minister.

CHAIR —I thought that myself. The estimates really should not involve a policy discussion of that kind. We are drifting into areas which are not covered by estimates and where the staff are not able to answer questions because they are getting into the areas of policy advice to the minister.

Senator LUNDY —It was not my intention to take the discussion in that direction. I was just trying to ascertain the parameters of the work which NOIE is being required to undertake. I am fully aware of the constitutional constraints on the Commonwealth. I was trying to clarify whether those considerations were being taken in that context.

Dr Badger —I think the issue is that it is clear there is a range of things, all of which you have identified yourself, that we will need to look at, and we are doing that. The nature of the final options that we put to government or the approach that we take on any one of those options takes us into the realm of commenting on policy approaches.

CHAIR —Or the kind of advice that might be given to a minister, and that is precluded.

Senator LUNDY —It would ease the pressure on officials if we had a minister present; albeit he would take many of these questions on notice, at least I could direct them to a minister, which would be highly appropriate.

CHAIR —The questions can still be placed on notice.

Dr Badger —We can certainly look at talking to the minister about responding to the questions.

CHAIR —We have reached 4 o'clock, which we said would be a scheduled tea break.

Proceedings suspended from 4.04 p.m. to 4.22 p.m.

Senator LUNDY —I have finished with the officers from NOIE.

CHAIR —The officers from NOIE may depart. Thank you very much for being here.

Ms Roper —Mr Chairman, before you call on the IT people, can I just correct the record about a comment that I made yesterday in relation to the Ministerial Council on Gambling? I noted yesterday for the record that I thought that the secretariat for the ministerial council was in NOIE but, having checked the records, I now find that it is within the Department of Family and Community Services, so I would like the record to note that change accordingly.

CHAIR —Thank you. That will be noted.

[4.24 p.m.]