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Foreign Affairs, Defence and Trade Legislation Committee - 27/02/2014 - Estimates - FOREIGN AFFAIRS AND TRADE PORTFOLIO - Department of Foreign Affairs and Trade

Department of Foreign Affairs and Trade

[09:05]

CHAIR: Minister, do you wish to make an opening statement?

Senator Brandis: No, thank you.

CHAIR: Do you wish to make a statement, Mr Varghese?

Mr Varghese : No, Senator.

CHAIR: Senator Dastyari will open for the ALP.

Senator DASTYARI: I am here for New South Wales but I will take the ALP title too. Mr Varghese, can we begin by you explaining to us the interaction and relationship between the Department of Foreign Affairs and the Prime Minister's office?

Mr Varghese : In the system of government that we have, the interaction is normally from department to department and from ministerial office to ministerial office. Obviously in the course of discussing and addressing policy issues there are often cases where we are engaged in discussions with the Department of the Prime Minister and Cabinet and sometimes those discussions can also include discussions with the Prime Minister's office. Given the importance of foreign policy, trade policy and aid policy issues in the overall framework of the government's priorities, clearly we have a lot to do with the Prime Minister's portfolio and with the office, including of course when the Prime Minister travels.

Senator DASTYARI: I assume, and this is completely reasonable, that you interact fairly strongly not only with your own minister's office, which is Minister Bishop's, but also with the PM's office, his staff and the PM?

Mr Varghese : There is a lot of interaction, as you would appreciate. The formal lines of interaction are department to department and office to office.

Senator DASTYARI: Explain to me how it works at an organisational level. Does the PM's office come to you for advice, do they go through the minister's office or is it kind of either or, depending on the circumstances or the event?

Mr Varghese : The formal source of advice to the Prime Minister is from his department, the Department of the Prime Minister and Cabinet. Those are the lines of accountability and the lines of reporting. But government is a joined-up entity these days, so obviously there is input from a number of different parts of the bureaucracy, and that includes the Department of Foreign Affairs and Trade.

Senator DASTYARI: But Mr Varghese, you and your department do interact directly with the PM's office as well. It would not be that uncommon for the PM himself to speak to you on a regular basis, as well as the minister. That is how I understand it works. Is that correct?

Mr Varghese : There would be occasions when I would speak directly to the Prime Minister's office. There would be occasions when they would initiate a discussion. But that needs to be set in the context of what the formal lines are.

Senator DASTYARI: I am just getting my head around how this works; there have been some media reports to this effect. Within the PM's office, is there anyone from DFAT seconded into there?

Mr Varghese : No. There is nobody from the Department of Foreign Affairs and Trade seconded to a policy role in the Prime Minister's office. There is an officer who provides administrative support, secretarial support, to the Prime Minister's office who is from the Department of Foreign Affairs and Trade.

Senator DASTYARI: Can you just quickly elaborate on what that means; I am just not familiar with it. Is it the trips—

Mr Varghese : None of the policy advisers currently on the Prime Minister's staff are on secondment from the Department of Foreign Affairs and Trade. But the person who traditionally has handled the administrative and secretarial arrangements for the international work of the office has traditionally been seconded from the Department of Foreign Affairs and Trade, and currently is.

Senator DASTYARI: The way you interact is, I take it, that your advice comes and goes and Minister Bishop's office advice comes and goes, and, as needed, you are brought in or brought out. Is that kind of how it works?

Mr Varghese : I think broadly speaking that is right.

Senator DASTYARI: Okay. Explain to me what the role of the National Security Adviser in the PM's office is.

Mr Varghese : As the name suggests, it is to advise on matters relating to national security.

Senator DASTYARI: And foreign affairs?

Mr Varghese : Well, national security and foreign affairs are intimately linked, so clearly there would be areas of overlap between national security and foreign affairs.

Senator DASTYARI: Are you able to take on notice getting back to us with a more detailed response as to the interaction between the department of foreign affairs and the PM's office since the Prime Minister become the Prime Minister, including formal meetings that have been held? I understand there are quite a lot of informal meetings and conversations that get held and I am not asking you to track all them down, but I just want to get an understanding of how the interaction between DFAT and the PM's office is working. Is that okay?

Mr Varghese : Sure, I am happy to take it on notice.

Senator DASTYARI: The PM's National Security Adviser is Andrew Shearer. Is that correct?

Mr Varghese : That is correct.

Senator DASTYARI: You are familiar with some of Andrew Shearer's work, writings and thoughts?

Mr Varghese : I have known Mr Shearer for quite some time.

Senator DASTYARI: Is that a yes?

Mr Varghese : I cannot say that I have read everything that he would have written, but—

Senator FAULKNER: Could you explain why not, Mr Varghese?

Mr Varghese : While I am sure, erudite though everything he has written, sometimes I do not have time to read everything.

Senator FAULKNER: I sincerely hope that you have read everything I have written!

Mr Varghese : Goes without saying, Senator.

Senator DASTYARI: Have you read 'Uncharted waters: The US alliance and Australia's new era of strategic uncertainty', his essay to the Lowy Institute?

Mr Varghese : What is the date of that?

Senator DASTYARI: August 2011.

Mr Varghese : No, I have not read it. I was abroad at the time.

Senator DASTYARI: Okay, I might put that on notice. I think it makes some very interesting reading.

Senator Brandis: What are you putting on notice, Senator?

Senator DASTYARI: I will get Mr Varghese a copy of it. Mr Varghese, did Andrew Shearer accompany the PM and Minister for Foreign Affairs to the APEC Summit in October in Bali?

Mr Varghese : Yes, he did, to the best of my recollection.

Senator DASTYARI: Who from DFAT went on that trip as well?

Mr Varghese : I was there from the Department of Foreign Affairs and Trade. We would have had, obviously, embassy officials who were supporting the delegation from Jakarta and from Bali, we would have had senior officials who were responsible for APEC, including our Ambassador for APEC. There might have been others. I would have to refresh my memory and check the delegation list.

Senator DASTYARI: The US-Japan-Australia trilateral strategic dialogue during the October APEC Summit in Bali, as I am sure you are well aware, resulted in the creation of a communique.

Senator DASTYARI: One of the outcomes of the US-Japan-Australia trilateral strategic dialogue during the October APEC summit in Bali, as I am sure you are well aware, was a communique. Can you explain to me what the process normally is for creating a communique of that kind?

Mr Varghese : The normal process is that officials from the relevant countries—in this case three countries—would get together and work on a draft communique, and that communique would be considered by the principals—in the case to which you refer, the foreign ministers of the three countries concerned—and then signed off and issued.

Senator DASTYARI: Who drafted it on the Australian side? Who was involved in the preparation of the communique? Obviously it was signed off by the minister, but—

Mr Varghese : That meeting was held before the Bali summit. I was not there for that particular meeting, because it was held immediately before the leaders meeting. I was there for the leaders meeting.

Senator DASTYARI: Who was there?

Mr Varghese : From the department?

Senator DASTYARI: Who was there, full stop?

Mr Varghese : There would not have been anyone from the Prime Minister's office or the Prime Minister's department there, because it was a meeting of foreign ministers. This was a meeting that was held immediately before the leaders summit, as I recall it, and the senior official responsible for contributing to the drafting would have been the person heading up our North Asia Division.

Senator DASTYARI: Who is that?

Mr Varghese : Peter Rowe.

Senator DASTYARI: Is Peter Rowe here?

Mr Varghese : I would have to check.

Senator DASTYARI: This is interesting, because media reports have said that Mr Shearer was there. I mean if he wasn't, he wasn't.

Mr Varghese : He was there for the leaders component of the APEC meeting.

Senator DASTYARI: Minister, do you mind if I ask specific questions to Mr Rowe about the trilateral?

Senator Brandis: No, that is fine.

Senator DASTYARI: Mr Rowe, with the consent of the chair, I am happy to table the communique if you need a copy, but I am sure you know exactly what I am talking about.

CHAIR: Senator, you can table it.

Senator DASTYARI: Can you explain to me in what circumstances this communique was prepared on the Australia side?

Mr Rowe : Sorry, I was not actually present at that meeting.

Senator DASTYARI: Who was present? It seems that no-one from DFAT was there. Was anyone from DFAT involved in the preparation of this communique? Who is running our foreign policy?

Mr Varghese : No. Obviously we would have been responsible. I apologise by assuming that Peter Rowe was there; clearly he was not.

Mr Rowe : I should clarify: I was consulted. I was phoned up about it at one point.

Senator DASTYARI: Who phoned you, Mr Rowe?

Mr Rowe : Mr Sam Gerovich.

Senator DASTYARI: Who is Mr Sam Gerovich?

Mr Rowe : The First Assistant Secretary, Trade and Economic Policy Division.

Senator DASTYARI: So was Mr Shearer there?

Mr Rowe : I am sorry, I do not know, but I would not imagine so.

Senator DASTYARI: Can you take that on notice, because no-one seems to have been there to be sure who was there and who was not. The media reporting said that Mr Shearer was there; I am just assuming.

Senator Brandis: If nobody was there, perhaps there was no meeting!

Senator DASTYARI: But out of that came this communique, correct? And we are not sure whether or not Mr Shearer was or was not there, or was or was not prepared in the preparation of this communique.

Mr Varghese : Senator, I am pretty sure he was not there, because he was in the travelling party to the APEC leaders meeting, which arrived after this meeting was held.

Senator DASTYARI: The PM's office was consulted in the preparation of something as significant as this communique, of course, weren't they?

Mr Varghese : I would have to check on that; I was not at the meeting.

Senator DASTYARI: But a communique of this kind would involve the Prime Minister himself having a role in this?

Mr Varghese : Not necessarily. This is a communique by three foreign ministers and it would not be unusual for foreign ministers to issue statements that do not necessarily involve the Prime Minister's office. Sometimes they do; sometimes they do not. It just depends on the issues.

Senator FAULKNER: A communique like this—and I have literally only seen its headline there—would have some involvement from DFAT as the relevant Australian agency. Would that be fair to say, Mr Varghese?

Mr Varghese : It would.

Senator FAULKNER: Normally, my understanding is, you would have an official level development of such a communique and then the involvement at the ministerial level or you may well have the involvement of ministers from an early point, but you would expect the early development of these things would be handled between officials from the relevant countries. I do not know what happened here but would it be fair to say that would be general practice?

Mr Varghese : It would, Senator. As I explained to Senator Dastyari, the normal practise is for officials to work on the draft of a communique and for that draft then to be considered by the principals.

Senator DASTYARI: This was one of the foreign minister's first overseas trips as foreign minister just based on it being in October. Who from DFAT was travelling with the foreign minister?

Mr Varghese : Can I take that on notice. I was not here so I do not know.

Senator DASTYARI: So there is no one—

Mr Varghese : Well there may be, I would have to know who they are to know if they are here.

Senator DASTYARI: There was no one who is here today at a senior level of DFAT that was involved in the drafting of this communique?

Mr Varghese : There may well be, but could you give me a minute to check whether that is the case.

Senator DASTYARI: Well, I am sure if there is an official, they will rush up to here. Mr Varghese, would you describe this communique as having a significant impact on our relationship with China?

Mr Varghese : I would not describe it as having a significant impact on our relationship with China. I mean, it is dealing with a set of issues including a set of regional issues which would be of interest to China and to other countries in the Indo-Pacific.

Senator DASTYARI: The Xinhua News, I am sure you are aware of the paper; but probably not the story from 7 December. I am going to read this to you:

China on Friday expressed strong dissatisfaction with Australia's statement over the establishment of the—

I will get to that, actually, in a second. I want to take it one step back, because something you said there was quite interesting. You do not see this as being of significance? I mean it just surprises me. You are saying there is a communique of this kind and no one in DFAT was involved that you can tell me in the drafting of it?

Mr Varghese : With respect, Senator, I did not say no one in DFAT was involved; quite the contrary. I said the normal practise is for a departmental official to be involved in the drafting of the communique. I am not in a position to tell you who that was because I was not there but I am very happy to find out who it was.

Senator DASTYARI: Did you know about the communique before it was issued?

Mr Varghese : I did not see the communique before it was issued but it is not the sort of thing that I would necessarily see before it was issued.

Senator DASTYARI: Would you see the communique as representing a change in our position when it comes to—

Mr Varghese : No.

Senator DASTYARI: But prior to this, at no point, had we made any kind of comment of this kind—taking a position on the East China Sea issue—is that fair to say?

Mr Varghese : If by taking a position, you mean 'do we have a view on how territorial disputes in the East China Sea should be handled' we do. If by taking a position, you mean 'do we side with one or the other claimant', we never have and I hope we do not.

Senator DASTYARI: You do not think this statement represents that?

Mr Varghese : No, I do not.

Senator DASTYARI: Is that how China sees it?

Mr Varghese : You would have to ask the Chinese how they see it but they may well have taken the view that it reflected us taking a position. If they did, they would be wrong.

Senator DASTYARI: You have seen the media reports to that effect?

Mr Varghese : I am aware of what China's view on this is.

Senator DASTYARI: Can you explain it to us?

Mr Varghese : I think China feels that that statement reflects a change in Australia's position, and I am telling you that it does not.

Senator DASTYARI: But has Australia previously taken a public position on this matter?

Mr Varghese : Would you like to draw my attention to the particular phrase that you are thinking of?

Senator DASTYARI: You would appreciate, Mr Varghese—you are the expert on this, not me—that the actual communique itself is as significant as the words within the communique.

Mr Varghese : I would have thought the words in a communique were what was significant.

Senator DASTYARI: The fact that there is a communique on 4 October, signed with the Japanese and the Americans, taking a position with which the Japanese are very comfortable with and the fact that we have never mentioned the East China Sea in a previous communique, I think, makes it significant. If this was a communique with Japan and China over an issue between Japan and China, that would be a very different matter. But to play this game where you pretend that this is not a significant communique, I just do not think passes the believability test.

Mr Varghese : I never said it was not a significant communique. You asked me if it had a significant impact on the relationship with China and I said I did not think it did. If you want to go to the-

Senator DASTYARI: It did have a significant impact.

Mr Varghese : Sorry?

Senator DASTYARI: Did it or did it not have a significant impact?

Mr Varghese : I said it did not have a significant impact on our relationship with China. If you want to go to the portion of the communique that deals with the East China Sea, I am very happy to do so and I am very happy to parse the meaning of it. And I am very happy to explain how not one phrase in that communique represents a shift in the Australian position.

Senator DASTYARI: I argue that the shift in the Australian position is that never previously had we in any kind of a communique of this kind taken a-

Senator EDWARDS: You are supposed to ask questions.

Senator DASTYARI: Well he is asking me questions there.

CHAIR: Let's just come down to earth a little bit. You ask questions; the secretary will reply. I do not think you should speak over the Secretary's responses. We would all like to hear them. Please proceed.

Senator DASTYARI: Can we talk about the summoning of the Chinese ambassador on 25 November 2013 to express concern about China's sudden announcement of an air defence identification zone over the East China Sea?

Mr Varghese : Sure.

Senator DASTYARI: Can you explain to us the process about how that came about and the consultation that you provided?

Mr Varghese : It is not uncommon for the department to ask a head of mission to come in to discuss an issue which is of concern to the Australian government. In this case, we had concerns about the way in which China had proceeded to proclaim the air identification zone and we wanted to make those concerns known to the Chinese government. The normal diplomatic practice is to do that through the ambassador here and that is what was done.

Senator DASTYARI: Is it common to publicly announce it?

Mr Varghese : It is not uncommon to publicly announce it.

Senator DASTYARI: Are you able to provide or take on notice a list of times we have actually publicly announced when we have done something of that kind?

Mr Varghese : Sure. It is not uncommon; it is actually quite common.

Senator DASTYARI: What is the diplomatic term for it? Is it demarche? Is that right?

Mr Varghese : A demarche is any communication that you have between one government and another on a particular issue.

Senator DASTYARI: Can you give me some examples now of when we have done it, and the outcomes?

Mr Varghese : Often if an issue is running hot in the media, the fact of a head of mission being called in becomes known. I am happy to go back and provide you with details, but in my experience it is certainly not uncommon for it to become public knowledge that we have asked someone to come in and have a chat.

Senator DASTYARI: And is that a decision for the Prime Minister's or the foreign minister's office whether or not it is being made public?

Mr Varghese : Normally, if we were to actually issue a statement on it, we would normally clear that with the minister's office if it is a departmental statement.

Senator DASTYARI: Did you issue a statement on this? Was there a statement issued on this?

Mr Varghese : I do not think the department issued a statement on it.

Senator DASTYARI: Did the minister's office?

Mr Varghese : I was out of the country at the time, but my recollection of it is that the minister's office did indicate that the Chinese ambassador had been asked to come in.

Senator DASTYARI: Someone, I assume, is consulted before a step as serious as calling in an ambassador and publicly outlining our position to the media. Surely you were consulted or someone would have been consulted.

Mr Varghese : Normally the decision to call in a head of mission would be taken in consultation and with the authority of the minister.

Senator DASTYARI: And in consultation with DFAT?

Mr Varghese : Between DFAT and the minister is what I meant, yes.

Senator DASTYARI: Did that happen in this case? Mr Rowe, can you explain to me the process around it?

Mr Rowe : The announcement took place over the weekend. As I recall, we did speak with the minister's office, and the minister wanted us to call the ambassador in.

Senator DASTYARI: So the minister asked for the ambassador to be called in.

Mr Rowe : It was the minister's office. I did not talk to the minister.

Senator DASTYARI: Of course, it was at the behest of the minister. Regarding the decision to make that public, I assume there are a lot of things that happen behind closed doors and then decisions occasionally get made to make these things public. What are the criteria for deciding to make it a public as opposed to a private communication?

Mr Varghese : In this instance, I think the minister made the judgement that she would refer publicly to the calling in of the ambassador. This is not an uncommon thing to do. Ambassadors are called in from time to time on a whole range of issues. The former Foreign Minister called in the Israeli ambassador to raise the issue of Israeli settlements at the end of 2012.

Senator DASTYARI: Do you think the calling in of the Chinese ambassador on that matter had a detrimental impact on the relationship with China?

Mr Varghese : We had a difference of view with China about their decision and the process they undertook to declare an air identification zone. We are talking about an issue where we had one view and China had another view. I think we have a sufficiently robust relationship with China to be able to accommodate differences of view.

Senator FAULKNER: I am by no means up to speed on the specific instance. But, generally, when the sort of process that you have outlined in detail to the committee occurs, when you have a situation where, as we have heard, the minister has requested this action, it is effectively a matter for the Department of Foreign Affairs and Trade to make the contact with the relevant embassy. That is true, isn't it?

Mr Varghese : That is correct.

Senator FAULKNER: It is obviously not done directly by the executive and the minister's office. It is done by the department. In the situation we are talking about, did the department provide advice to the minister? Let's take a step back. You have described this process as not uncommon, and I agree with you—I think that is a fair comment. When such a process takes place, is it routine also for the department to provide advice to the minister about such a course of action?

Mr Varghese : In the course of the discussion with ministers about an issue, a number of options would be canvassed. One of those options, depending on the circumstances, could well be whether or not to call in an ambassador.

Senator FAULKNER: Fair enough. Cutting to the chase here, I am not going to ask you the nature of your advice. I will not do that. As you know, I would like to. But I would not do that because there is little point. But I will ask you whether advice was either sort or given in relation to this particular demarche that Senator Dastyari has questioned you about. It is a question of whether DFAT advice was sought by the minister, or whether DFAT advice was given to the minister in relation to this demarche.

Mr Varghese : Because I was overseas at the time, I might ask Mr Rowe whether he can clarify that particular point.

Senator FAULKNER: I am not going to the substance of the advice. I am merely asking for process, which I thought might actually cut to the chase here.

Mr Rowe : I am recalling something that happened some time ago. We would have discussed it with the minister's office, but I think the nature of what we said in these circumstances was devised by DFAT itself. But we had a view on the ADIZ—the air defence identification zone—and we expressed that to the ambassador when we called him in. It was only in general terms at that point discussed with the minister's office.

Senator FAULKNER: So that we are clear on the processes—I have not even read the relevant newspaper article—there has been a demarche in this instance. That is understood. You have informed Senator Dastyari that this has been done as a result of an initiative of the minister's office. Fair enough, I accept that. I am merely asking whether advice was sought by the minister's office of DFAT in relation to that demarche, and if so, was it provided? Or was it provided; I will not even relate the two matters.

Mr Rowe : I think that would be right, because it was all done informally over the telephone.

Senator FAULKNER: It was not formal written advice?

Mr Rowe : No.

Senator FAULKNER: You think it is fair to say that advice was sought and advice was given?

Mr Rowe : We discussed it I think would be the best way to describe it.

Senator FAULKNER: How contemporary to the action was that discussion? You are giving the impression that it was a fairly quick operation.

Mr Rowe : Yes. I think it probably occurred on Monday morning and the ambassador was called in that day.

Senator FAULKNER: Would that be the normal process, Mr Varghese? I do not know; that is why I am asking.

Mr Varghese : There is nothing unusual about that. Once you make a decision to ask an ambassador to come in, you usually do it pretty quickly.

Senator DASTYARI: I want to get my bearings on this. The other thing that I think is obviously different but comparable is the visit of the Japanese Prime Minister to the Yasukuni Shrine, which I am sure you are well aware of. I want to get my head around what the Australian response to that has been.

Mr Varghese : We have not publicly issued a statement on Prime Minister Abe's visit to the Yasukuni Shrine. This is a matter which has come up in our discussions with the Japanese but we have not issued a public statement.

Senator DASTYARI: There has been no public announcement. Does the Australian government regard the Yasukuni Shrine visit as contributing to the tensions in North-east Asia?

Mr Varghese : Can I clarify what I just said about—

Senator DASTYARI: You are going to read the quote on 23 January 2013?

Mr Varghese : No, I was going to draw your attention to a speech that the Foreign Minister made in Washington on 22 January—

Senator DASTYARI: I have the media report from the next day.

Mr Varghese : where she said that the visit, along with China's Air Defence Identification Zone announcement, had brought to the fore the unresolved tensions between China, Japan and South Korea and such events escalate the already tense regional environment. The comment there was—

Senator DASTYARI: I agree with you on that point and I was going to raise it with you. She is placing the two on a comparable basis in that statement, and my question is, if there is a formal and public rebuke to China over the Air Defence Identification Zone, why wasn't there a similar process undertaken with Japan over Abe's Yasukuni Shrine visit if both of them are contributing to tension in the region?

Mr Varghese : I think it is your construction that the foreign minister meant to imply an equivalence there. She was referring to both and she made what I think is an uncontestable proposition, that that has implications for an already tense regional environment. But I would not necessarily accept the underlying assumption you are making that there is an equivalence between the two.

Senator DASTYARI: My question is why was there a public rebuke of the Chinese ambassador over the issue of the air zone, the ADIZ, which resulted in things as significant as stories in the Chinese daily press and which I think damaged our relationship with China—that is a policy point which we can argue through the parliamentary process—but there was not a similar rebuke of the Japanese ambassador over what I think is a highly offensive visit to the Yasukuni Shrine?

Mr Varghese : In diplomacy, you take issues as they come and you deal with them on their own merits. The air identification zone goes to the issue of how very sensitive regional security issues are going to be managed now and into the future. It goes to the question of ensuring that regional tensions are carefully managed. The view that we had, at the time of that announcement, was that it was a unilateral move which did not contribute to managing what was potentially a very serious set of security issues. We thought that that was serious in its own terms and we acted accordingly.

Senator DASTYARI: Have there been representations received from the Chinese government on the matter of the Yasukuni Shrine visit?

Mr Varghese : Representations to us?

Senator DASTYARI: Yes.

Mr Varghese : China's position on Prime Minister Abe's visit to the Yasukuni Shrine is well known. They have shared that view with us.

Senator DASTYARI: Is the same to be said for the Korean government?

Mr Varghese : Yes, I think it is quite clear, from the public record, that the Korean government also had serious concerns.

Senator DASTYARI: Mr Rowe, on the dressing-down of the Chinese ambassador, was there at any point a direct conversation between DFAT and the foreign minister herself, where you provided advice as to whether you thought this was an appropriate diplomatic move?

Mr Varghese : Can I just say that it was not a dressing-down.

Senator DASTYARI: They are my words, not yours. They are on my notes!

Mr Varghese : I think it is an important point—it was not a dressing-down.

Senator DASTYARI: Fine, I will withdraw the term dressing-down. We were using the term 'demarche' before, so we can continue to refer to it as that. Mr Rowe?

Mr Rowe : I did not discuss it with the foreign minister herself, no.

Senator DASTYARI: Can we take on notice if anyone from DFAT had a conversation with the foreign minister or the Prime Minister about this, before those steps were taken.

Mr Rowe : I can pretty confidently say that nobody discussed it with the Prime Minister and I am pretty sure that nobody discussed it with the foreign minister. It would not normally work that way. The discussion would normally be with a member of staff.

Senator DASTYARI: Mr Varghese, how would you describe the current relationship between Australia and China?

Mr Varghese : I think it is a very good one: it is a strong relationship; it is a broadly-based relationship and it is a growing relationship. I met earlier this week with an assistant foreign minister of China; it was a very positive discussion and I think that both sides are looking at this year as the year of opportunity in the relationship. We are expecting our Prime Minister to visit in the first half of the year.

Senator DASTYARI: Has that been finalised?

Mr Varghese : It has not been. We are looking forward to President Xi Jinping visiting for the G20 and hopefully making a bilateral visit. It is an important relationship and it is well grounded.

Senator DASTYARI: I am just reading the media reports to this effect in relation to the Prime Minister's proposed visit, but can you tell me if it is correct that he is going to attend the Boao Forum for Asia Annual Conference between 8 and 11 April?

Mr Varghese : We are still working on the Prime Minister's travel schedule and when it is finalised, I am sure that the Prime Minister will announce it. We are obviously working with dates and working on the itinerary, but the normal diplomatic practice is not to announce visits until everything is locked in, and both governments are comfortable with an announcement. We are not quite at that stage yet.

Senator HEFFERNAN: Our relationship with China is very strong.

Senator DASTYARI: That is a policy point. I am happy to argue with you, Senator Heffernan, at a different time, though I am quite worried about the relationship. You are not prepared to confirm an April visit to China?

Mr Varghese : We will confirm it when it is announced. That is normal diplomatic practice. Before it is announced, we do not confirm it.

Senator DASTYARI: Has the government of China placed any conditions, explicit or implicit, on the pending visit? Where are the negotiations at?

Mr Varghese : No, it has not placed any conditions on the visit, and it would be extraordinary if they did.

Senator DASTYARI: Perhaps if we can take a step back and look at the series of events. Mr Varghese, you have no doubt seen the media reports about the relationship with China. I would like to get your views on where the relationship is heading and whether the recent diplomatic steps over the Yasukuni Shrine visit have compounded that.

Mr Varghese : Senator, I have given you my view on how I think the relationship is tracking. Like any relationship, we are not going to agree on everything. In the case of China there are issues on which we have different views, but I think it is a measure of the relationship that we are able to accommodate differences of view and still build the relationship to an even stronger level.

Senator DASTYARI: What is your view on ranking our diplomatic partners and friends, Mr Varghese?

Mr Varghese : At the end of the day all policy frameworks work off a series of priorities and from time to time Australian governments of all persuasions have articulated what those priorities are.

Senator DASTYARI: Was DFAT's view sought before the quote which was something like 'best friend in Asia'?

Mr Varghese : Are you referring to the Prime Minister's remarks?

Senator DASTYARI: Yes.

Mr Varghese : I do not think advice was explicitly sought before the Prime Minister made those comments, and nor would I expect advice to be sought.

Senator DASTYARI: What does 'best friend' mean to you?

Mr Varghese : Senator, I am not in the business of doing a running commentary on the Prime Minister's comments.

Senator DASTYARI: But you are the Secretary of DFAT and these things have significant policy ramifications.

Mr Varghese : In diplomacy, what you say can sometimes have ramifications.

Senator DASTYARI: Has this had any ramifications?

Mr Varghese : I do not think it has had any negative ramifications.

Senator DASTYARI: What about the references to Japan being an 'ally'? Can you describe in diplomatic terms what an 'ally' means?

Mr Varghese : An ally is a country with which you have an alliance relationship.

Senator DASTYARI: Do you want to elaborate on that a bit? Are you aware of us ever referring to Japan as an ally before?

Mr Varghese : The term 'ally' can be used in a precise way and it can be used in a generalised way. It can be used with a capital 'A' or a small 'a'. Japan is not a capital 'A' ally because we do not have a security agreement with Japan in the way that we have with the United States. Japan is a very close economic and strategic partner.

Senator FAULKNER: Will I find the use of upper case and lower case in some diplomatic handbook? That is one of the most interesting things I have ever heard at estimates.

Senator Brandis: I think the point, plainly, that the secretary is making is that there are international agreements between certain countries, such as the ANZUS agreement, which are alliances in a formal sense—in the sense of a proper noun—and there are relationships between friendly countries between whom there does not necessarily exist an international agreement in a formal sense but whom nevertheless can be described in common speech as 'allies'.

Senator DASTYARI: Mr Varghese, is it fair to say that you are saying that the decision to refer to Japan as our best friend in Asia and the use of the term 'ally' are matters and decisions for the Prime Minister?

Mr Varghese : They are the words of the Prime Minister.

Senator DASTYARI: And they are matters for the Prime Minister without the input of DFAT?

Mr Varghese : The words he uses are a matter for him.

Senator FAULKNER: What I interpreted you as saying—if I can put my words to it—is, 'There are allies and allies,' and in that sentence one of the allies has an upper-case 'A' and one has a lower-case 'a'. Is that really what you were saying?

Mr Varghese : I was making the general distinction between a capital 'A' ally and a small 'a' ally. I was not making that distinction specifically with regard to what the Prime Minister said.

Senator DASTYARI: What happened to the Australian Minister for Foreign Affairs in Beijing on 6 December 2013, during her visit there?

Mr Varghese : What happened to her?

Senator Brandis: It is a slightly open-ended question.

Senator DASTYARI: Explain to me the circumstances.

Senator FAULKNER: This could be very interesting!

Senator DASTYARI: The foreign minister visited Beijing on 6 December 2013. Were you there?

Mr Varghese : No, I was not with the foreign minister.

Senator DASTYARI: Who from DFAT was?

Mr Varghese : Because I misled you last time, let me check.

Senator DASTYARI: Mr Rowe, were you there?

Mr Rowe : I was there.

Senator DASTYARI: Obviously there was a fair bit of media reporting around some of the events of that day, in particular the comments that were made by the Chinese foreign minister—the correct term is foreign minister, isn't it? Can you explain the circumstances around that.

Mr Rowe : There was a formal meeting with the foreign minister in which he expressed some views in public at the beginning of the meeting.

Senator DASTYARI: What were those views?

Mr Rowe : He was certainly unhappy with our actions over the defence identification zone.

Senator DASTYARI: At that point, did he raise just the defence identification zone? As I understand it, there were a couple of different things. Was there disagreement over the communique with the United States and Japan?

Mr Rowe : I do not recall he raised that at that point.

Senator DASTYARI: What did he raise?

Mr Rowe : He raised our comments on the identification zone.

Senator DASTYARI: Can you elaborate on that?

Mr Rowe : I would like to check the record so that I have it straight, but he had said something to the effect that it had created risk for the relationship or something.

Senator DASTYARI: Is there an example of a previous time when those kinds of comments about an Australian government or Australian foreign minister were publicly aired?

Mr Rowe : No, I have never in 30 years encountered such rudeness, actually.

Mr Varghese : It is often the case that foreign ministers of Australia would have a robust discussion with foreign ministers of other countries.

Senator DASTYARI: Not normally in front of the media, though.

Mr Varghese : Normally it is not done in front of the media, but it depends, I suppose, when the media leave a room.

Senator DASTYARI: The media were invited to be there. You were not there. Mr Rowe, the media were invited to stay for that—correct?

Mr Rowe : They are there always at the beginning of a meeting. They are there for the meeting and greeting and then they are ushered out.

Senator DASTYARI: So the Chinese foreign minister knew the media was there when he made these comments?

Mr Rowe : Yes. They wanted to make a point; they often do it with a new foreign minister and it settles down after that. It was nothing that the Chinese would not do, and we would not be the only ones—

Senator DASTYARI: Didn't you say you had never encountered anything of the kind in 30 years?

Mr Rowe : Not me personally. I have never encountered it. But that does not mean—

Senator DASTYARI: And you have been at the Asia desk for 30 years?

Mr Rowe : Off and on.

Senator HEFFERNAN: Can I seek a point of clarification. In God's name who are we talking about? Who was the foreign minister? What period we are talking about?

Senator DASTYARI: Julie Bishop. Mr Rowe, are you saying that in 30 years you have never seen anything of its kind in your role at DFAT?

Mr Rowe : I have not seen the Chinese—

Senator DASTYARI: Yet Mr Varghese is saying that we have a fantastic relationship with China.

Mr Rowe : Yes. That does not mean it is not. We have a strong relationship. We immediately after that had a very successful one-and-a-half track dialog. The fact that foreign ministers can exchange views frankly is not extraordinary.

Senator DASTYARI: But you said it was extraordinary.

Senator Brandis: He did not say it was extraordinary.

Senator DASTYARI: He said he had never seen anything of its kind in 30 years.

Mr Rowe : I thought it was rude. Sorry, I did say that—perhaps I shouldn't. But I said I had not seen that rudeness. But it is robust. That was all.

Senator DASTYARI: How on one hand—

CHAIR: I think you have made your point, Senator.

Senator DASTYARI: I have one last question—

CHAIR: We have had a very long time—I think it is now 40 minutes—so I think we have to move on to other senators, with respect.

Senator DASTYARI: I will come back later.

CHAIR: Mr Varghese, I would just like to clarify something. Senator Dastyari just mentioned the Boao conference. Would you like to explain what that is? It is business and political leaders, isn't it?

Mr Varghese : Yes, it is. It started as a kind of Asian version of Davos. Bob Hawke was one of the founders of the forum. Over time it has grown into a major conference that attracts the leadership of China and very senior business participation from around the region and beyond, because, now, leaders from many parts of the world do come to Boao for the annual forum.

CHAIR: Julie Bishop attended it a couple of years ago, as shadow foreign minister, I believe, as the sole Australian representative.

Mr Varghese : I think Julie Bishop has been to several Boao forums.

CHAIR: That was the first one, though. There was also one in Perth a couple of years ago—unusually—held for the first time out of Hainan. Minister Bishop went there when no other ministers went—she went as a shadow minister. Isn't that the case?

Mr Varghese : I think there have been years where Australia has not been represented by a minister. I think in one of those years Ms Bishop may well have gone as the shadow foreign minister.

CHAIR: She did in fact.

Senator MILNE: I wanted to ask Mr Varghese, particularly, about the Prime Minister's visit to the meeting with the Crown Prince of Abu Dhabi with regard to Matthew Joyce and Marcus Lee, Australian citizens who had been convicted there. Did the Prime Minister's office request that the Department of Foreign Affairs and Trade set up the meeting, and who accompanied him to that meeting? I want to know whether foreign affairs suggested or recommended to the Prime Minister that he take this action, or whether the Prime Minister's office asked the Department of Foreign Affairs and Trade to support and engage in that action.

Mr Varghese : I might ask Mr Justin Brown, who is the first assistant secretary responsible for consular issues, to answer that question.

Mr Brown : I think you asked two questions: who set up the meeting and who from DFAT attended the meeting.

Senator MILNE: I am asking whether the Prime Minister's office requested that DFAT set up the meeting and, regardless, who went with the Prime Minister. Alternatively, did the Department of Foreign Affairs and Trade recommend to the Prime Minister that he take this action?

Mr Brown : My recollection is that the meeting was scheduled at the direction of the Prime Minister's office and the Department of the Prime Minister and Cabinet, and that the embassy in Abu Dhabi was asked to make the arrangements for the meeting. Again, I would like to check carefully, but my recollection is that the only DFAT officer present at the meeting was our ambassador to the UAE.

Senator MILNE: Following on from that, are you aware that Australian citizen Peter Greste is currently imprisoned in Cairo. Have you had any requests or direction from the Prime Minister's office to set up any meetings or take any action to support the release of Peter Greste, in Cairo?

Mr Brown : We are in regular contact with the Department of the Prime Minister and Cabinet and, on some occasions, the Prime Minister's office, to keep them informed of the developments in the Greste case. We have produced a significant amount of reporting on developments. Most recently we have consulted the Department of Prime Minister and Cabinet on a detailed strategy to make representations and advocate on behalf of Mr Greste. That strategy is currently being implemented.

Senator MILNE: I want to put on the record that the people I have talked to in his family and community are very grateful for the consular assistance that has been provided to date. But in your answer you said there had been regular contact et cetera but your answer implies it has all been from the department up to the Prime Minister's office. I wanted to ask specifically if there has been any direction from the Prime Minister's office to you to engage the Prime Minister in making representations in Egypt?

Mr Brown : To this point I do not have any recollection of a specific instruction from the Prime Minister's office as regards his potential involvement in this case. As you are aware, Mr Greste is currently facing judicial proceedings in Egypt. There is a question therefore as to, in practical terms, the most appropriate opportunity for head of government representations on his behalf. I mentioned in response to your last question that we have developed and are now implementing a significant strategy—a multi-pronged strategy—to deal with this case. The issue of how and when possible head of government representations might be made is certainly part of that strategy.

Senator Brandis: I think it is also relevant to remember that, in relation to the Marcus Lee case, the Prime Minister was actually in Abu Dhabi on his way back to Australia from Afghanistan. The Prime Minister, I am advised, has no current plans to be visiting Egypt.

Senator MILNE: But Prime Minister Abbott could speak out from Australia, as indeed John Kerry has, from the United States. Could I ask specifically what other senior politicians from around the world—government ministers, in fact—have spoken out in relation to Peter Greste in support of his release.

Mr Brown : Do you mean from other governments?

Senator MILNE: Yes, I mean from other countries.

Mr Brown : You have mentioned the secretary of state and I can recall that there have also been comments from the UK foreign secretary, Mr Hague. They have been very much focused on the importance of freedom of the media, which is certainly an issue that has featured prominently in public statements by both Prime Minister Abbott and Foreign Minister Bishop.

Senator Brandis: Can I give you some more information in response to that question. The foreign minister, Ms Bishop, raised Mr Greste's case directly with the Egyptian foreign minister, Mr Nabil Fahmy, on 28 January. She also raised Mr Greste's case with the Egyptian ambassador, Mr Hassan El-Laithy, on 16 January. Australia's ambassador to Egypt, Dr King, met the ministry of justice in Egypt in 22 January and 10 February. Dr King met the prosecutor general on 30 January and met with the Ministry of Interior on 12 February. He is continuing to have a close personal involvement in the case. You can see that at both the political level, at the foreign minister level and at the diplomatic level the government has been actively engaged in Mr Greste's case in making representations to the Egyptian authorities.

Senator MILNE: What representations have been made subsequent to the court appearance? Prior to that, the statements had been that we wanted basic standards of justice to apply and that the matter be handled fairly and expeditiously. Subsequent to the court appearance, it is fairly clear that it is not being handled fairly or expeditiously and basic standards of justice are not being applied given the difficulty of Peter Greste being able to assemble a defence case. Why has the Prime Minister or the foreign minister not spoken out subsequent to that court case, where the conditions were clearly breached?

Senator Brandis: I think I have just told you that. The foreign minister has been actively involved, including at a minister-to-minister level with the case. The Australian Ambassador to Egypt, Dr King, has had a constant and active involvement with the case. I might also add that I am advised that we are drawing on our contacts with other governments, which have influence and standing in Egypt, to bring the case to their attention and to seek their advice in encouraging Egypt to bring Mr Greste's case to a satisfactory conclusion.

It is not in Mr Greste's interests for us to be discussing the details of that engagement publicly. We have also welcomed the public remarks by both John Kerry and Mr Hague urging Mr Greste's release. As the Prime Minister might say, we are all on the team here in trying to get the best outcome for Mr Greste. We are taking all appropriate steps at a ministerial level and a diplomatic level, and through Australia's friends and allies—including, in particular, the United States and the United Kingdom.

Senator MILNE: But that has not included a statement subsequent to the court proceedings condemning the way that Peter Greste was actually handled.

Senator Brandis: With all due respect, I think that obviously this is an important and delicate matter. I say this with all due respect, perhaps the judgement should be left to the professionals and the people who are actually dealing with agencies of or individuals within the Egyptian government to make their own judgements as to what is best done through private discussion and what is best done by public declarations.

Senator MILNE: With all due respect, if it had been left to that on the case of Colin Russell, he would still be in jail in Russia.

Senator Brandis: I do not know that you can say that. Anyway, I have made my point.

Senator MILNE: I want to go onto the case of John Short and ask specifically what action the department or the government has taken in relation to his being detained in North Korea?

Mr Brown : As you aware, we do not have diplomatic representation in North Korea. We have an arrangement with the Swedish embassy in Pyongyang, where it acts as our agent to pursue issues—including consular issues. We have therefore, through the Swedish ambassador in Pyongyang, submitted a formal request to the DPRK authorities seeking information on Mr Short's whereabouts and his medical condition and requesting immediate consular access to him. We have yet to receive a reply to that request.

We have, as is normal practice in such cases, sought advice, guidance and assistance from a number of other governments—particularly the United States, which has had a number of Christian missionaries in similar detention in North Korea in the past. We have also sought assistance from the UK and a number of other governments to try and exert pressure on the DPRK authorities to respond to our request. I am reluctant to go into too much detail, as you might appreciate. We have yet to hear from Mr Short. We do not know anything about the conditions in which he is being held. Further public comment could jeopardise our opportunities to secure his early release.

Senator MILNE: I will go back to Colin Russell for a moment. After Colin Russell was released, the Minister for Foreign Affairs, Julie Bishop, said that she may ask him to foot the bill for the government assistance provided in Russia, saying that it runs into tens of thousands of dollars. Did DFAT recommend to the minister that steps be taken to recover the costs of assisting an Australian citizen held unjustly in Russia?

Mr Brown : What the foreign minister said was that in the light of Mr Russell's case she would ask the department, as part of its ongoing process of developing a consular strategy for the next three years, to look at the issue of whether it is viable to introduce a cost recovery element into our future approach to the delivery of consular services. That consular strategy process, which has involved an extensive request for public submissions, is underway, and we will be providing the minister with our initial advice on the elements of that strategy in the coming months.

Senator MILNE: Specifically, the minister requested DFAT to look at a cost recovery strategy for consular assistance for Australian citizens overseas?

Mr Brown : Just to be clear: what the minister has asked that we do is look at the pros and cons of introducing some cost recovery elements as part of our consular strategy. So what we are being charged with doing is providing the minister with advice on what is feasible and what is practical in a policy sense in this area.

Senator MILNE: Did the minister suggest any parameters around the conditions that she would like to see imposed in terms of cost recovery?

Mr Brown : She has not specified any conditions other than that there is obviously a concern, which is a key factor behind the decision to launch this consular strategy process, that there is a growing disparity between the expectations of the travelling public as regards consular assistance and the capacity of the department and our network of diplomatic posts to deliver consular services. So, in order to ensure that we have a viable and sustainable consular service in the long term, we do need to look at ways in which we can address this question of public expectations. Cost recovery could be one of the elements that might assist in that regard, but it is one that we are currently assessing as part of the development of the strategy.

Senator MILNE: I know other people are waiting to ask questions. Thank you for that.

Senator EDWARDS: You would remember that last time we were together I asked some questions about the travel activities of the former foreign minister in the Labor government. In an answer to a question on notice taken then, the department advised that it had received seven requests for assistance from the then Prime Minister since 14 September 2011. Two requests for assistance were received from Julia Gillard. I want to move to former Prime Minister Rudd. On a visit to New York, Canada and Boston on 21 to 28 November, the department provided airport facilitation, a vehicle and a driver for Kevin Rudd. Could you give me an idea, given that you probably have it with you, of the cost of that assistance which was provided to Kevin Rudd at that time?

Mr Varghese : Maybe I could begin an answer to that question, and Mr Roach may want to add to it. Former prime ministers are extended certain courtesies in relation to their international travel, and those courtesies are always subject to the resourcing available at a particular post. Airport facilitation would normally be considered one of the appropriate courtesies to extend to a former Prime Minister, as would the provision of transport to official appointments—obviously not to private or business appointments. The costs of those courtesies are absorbed by the mission and are not separately costed out. It is part and parcel of what the mission does.

Senator EDWARDS: During his trip to Boston, did Kevin Rudd visit Harvard University or meet with officials from the John F Kennedy school?

Mr Varghese : I would have to take that on notice—unless Mr Roach has an answer?

Mr Roach : No.

Mr Varghese : We will take that on notice.

Senator EDWARDS: In just your previous evidence, you said that you do not afford these courtesies to former prime ministers for private appointments.

Mr Varghese : That is right.

Senator EDWARDS: It is very public that Mr Rudd was probably at a job interview.

Mr Varghese : I do not have any information on that. I am very happy to check whether—

Senator EDWARDS: It will reveal itself, won't it? In November he was there, and just this month it has been announced that he is going to Boston to base himself with his new role. I am very interested to know how much the taxpayer paid for Mr Rudd to travel to Boston, effectively, probably, for his job interview which was announced this month.

Mr Varghese : We will take it on notice. You are assuming that we did—

Senator EDWARDS: I am assuming a lot.

Mr Varghese : but let us check.

Senator EDWARDS: Let us get the information. How many requests for assistance have been made by Mr Rudd and Ms Gillard since the last Senate estimates?

Mr Varghese : Can I take that on notice as well?

Senator EDWARDS: Okay. And, if you could, when was each request received, and what was the nature of the request? Also—

Senator STEPHENS: Just on that issue: perhaps, Mr Varghese, you might be able to provide that information about all former prime ministers. You can take it all on notice.

Mr Varghese : I am happy to take on notice whatever the committee wants me to take on notice.

Senator STEPHENS: Thank you.

Senator FAULKNER: Mr Varghese—

Senator Brandis: I am sorry—before you go into another question, Senator Faulkner. What is it that you want Mr Varghese to take on notice, because Senator Edwards's questions were directed to a particular trip?

Senator STEPHENS: No, he asked about what consular assistance has been provided to the former prime ministers.

Senator Brandis: Over what period are you asking?

Senator STEPHENS: Since last estimates, he said.

Senator Brandis: I see. All right, thank you.

Senator FAULKNER: He identified two former prime ministers, and I think what Senator Stephens did was to add, from former prime ministers Rudd and Gillard, all former prime ministers. That is my understanding.

Senator STEPHENS: Yes.

Senator Brandis: Since the last estimates.

Senator FAULKNER: I was going to make the point to you, Mr Varghese, that it struck me, on at least one of the questions that you have taken on notice, which I think is an entirely proper thing to do, that, if a matter is, let us say, private—or it could be a public matter; it does not matter—but there is no involvement of DFAT, it is going to be impossible for the Department of Foreign Affairs and Trade to answer such a question on notice. It is one thing to take a matter on notice, but, if there is no involvement from the department—which I suspect, or I think is possible, listening carefully to the questions that have been asked of you—it is drawing a long bow to take such matters on notice. I am just checking with you that, in taking a matter on notice, obviously you will inform the committee in a written answer if there is no involvement of the department in any matter that has been taken on notice. In other words, I do not want to see the department try and spend a great deal of its resources trying to establish a matter that the department has no involvement in.

Senator EDWARDS: They will know that very quickly, Senator Faulkner.

Senator FAULKNER: I am not asking you. I am asking Mr Varghese.

Senator EDWARDS: I would like to continue my question.

Senator FAULKNER: Well, I am asking a question at the moment, which is fine. I do not want to interrupt you, but the matter we have before us at the moment is a range of questions that have been taken on notice, which—I am making the point—may or may not be able to be answered by the Department of Foreign Affairs and Trade. That is fine. I totally accept that, but if these matters are outside the remit of the department, I would not want to see the department then start some fishing expedition to try and answer a question that does not involve the expenditure of Commonwealth moneys. I am just establishing with Mr Varghese, which I am sure he will, that that is a ruler he would properly run over any answer.

CHAIR: Thank you, Senator. I am sure Mr Varghese will do that.

Senator FAULKNER: I would like to hear Mr Varghese's response.

Senator EDWARDS: I am sure Mr Varghese is appreciative of your counselling.

Senator FAULKNER: Given that I have just asked him—one thing that Mr Varghese has proved over the years is that he is more than capable of answering questions for himself on behalf of the agency he represents at the table. So let us let him do it.

Mr Varghese : Well, Senator, as I understand the request from Senator Edwards and now supplemented by Senator Stephens, we will provide the committee with information on when our departmental and diplomatic resources have been used to support travel by former prime ministers. Now, obviously, if former prime ministers have engaged in appointments or meetings that had no departmental support, we would not cover that. So we will restrict our focus—

Senator FAULKNER: Correct. So if you were asked a question about an event that might have taken place at an American university, and there is no departmental involvement, I just want to be assured that you will make that clear to the committee too. In other words, we do not want departmental resources utilised on trying to find out details about the non-official matters or functions that anyone is attending, be they former prime ministers or Uncle Tom Cobley.

Mr Varghese : I think if we provide the committee with information on where departmental resources have been used, we can assume that on every other aspect they were not used, rather than specifically respond to—

Senator FAULKNER: I think that is right, but when you take on notice a question about a specific event, if for that specific event there is no use of departmental resources, then to say that such matters will be answered on notice might leave open the suggestion that the department would go to lengths—it does not matter who the individual is—to find out information that is basically beyond its competence. I am sure you would not do that—

Mr Varghese : I understand the point you are making, Senator.

Senator FAULKNER: That is the only point I am making, because one of the questions taken on notice was very open-ended. How would I know whether it involves departmental resources or not, and, clearly, I would not expect officers at the table to know. But we need to make clear that we are not making a request of the agency that would be really tilling new ground. It would be absolutely unprecedented.

CHAIR: Senator Faulkner, I am sure the department will keep those principles in mind—

Senator EDWARDS: He is being very specific, Chair.

CHAIR: We will go back to Senator Edwards.

Senator EDWARDS: You have made the distinction between private and official and I am sure that you will be able to differentiate between the two. I move on. In answer to a question taken on notice at last estimates, the department advised that on occasions a spouse of a diplomat would be employed on a temporary basis to accompany Mrs Carr during her visit. How many occasions was a temporary offer of employment made to a person or persons specifically for the purpose of accompanying Mrs Carr during any of her visits?

Mr Varghese : Are you referring to an answer we have provided the committee?

Senator EDWARDS: In an answer to questions taken on notice from the last estimates, the department advised that on occasions a spouse of a diplomat would be employed on a temporary basis to accompany Mrs Carr during her visit. Mrs Carr was accompanied by embassy officials effectively to act as a guide, I suggest, for Mrs Carr when the former foreign minister was in that region. On how many occasions was an offer of temporary employment made to a person specifically for the purpose of accompanying Mrs Carr during any of those visits?

Mr Varghese : I do not have an answer to that, but Mr Roach may be able to help.

Mr Roach : I will have to take that on notice. We did talk about this at the last Senate estimates hearing. I recall making the remark at that time that on occasions, for spouses and partners of foreign, trade and other ministers who come through, that arrangement is sometimes put into place. Specifically in regard to Mrs Carr, I would need to take that on notice.

Senator EDWARDS: Can you let me know what visits did occur?

Mr Roach : Certainly.

Senator EDWARDS: Can you also let me know on how many days those people were employed to effectively guide Mrs Carr, and the total cost of the employment for those tour guides.

Mr Roach : I will take that on notice. I will also make the point that, in some cases, officers spouses are happy to do this role without being paid. It is not necessarily a paid—

Senator EDWARDS: I agree, and I think that is terrific. It is wonderful that they do that. I am interested in any costs that were incurred to carry out this function.

Mr Roach : We will look into that.

Senator EDWARDS: I will move along to another answer to a question taken on notice at our last estimates. The department provided an extensive list of historical or cultural sites visited by Mr and Mrs Carr. You would be aware of that extensive list that you provided on notice for me. What was the cost of all of those visits to those historical and cultural sites?

Mr Roach : We would not be able to provide you with a sense of how much that cost. Those visits would have been worked into visit programs. There may have been particular circumstances and reasons why they visited those sites. I know that the question we answered was the one that was put to us. That was: what cultural and historical sites had been visited. In some cases those would have had particular links with Australia. For instance we may have been providing assistance, whether it be through the Australian aid program for some work that was going on there. But in terms of what was the cost of going for an hour to a particular site I am afraid we cannot provide any kind of breakdown.

Senator EDWARDS: I don't know whether they were for an hour, a day or half a day.

Mr Roach : They would have been visits of hours at a maximum.

Senator EDWARDS: Were all of these official visits?

Mr Varghese : They were all part of an official program.

Senator EDWARDS: Nothing outside an official program?

Mr Roach : The fact that we provided the answer means that they were part of an official program.

Senator EDWARDS: Were all of those a part of a program that was given to you by the then foreign minister or that you gave him? Did he have input into all of those places that he visited?

Mr Varghese : Typically when a post is putting together a program—

Senator EDWARDS: That is my question: did the post put the program together or did the foreign minister put the program together for the post?

Mr Varghese : Typically this is an iterative process. The post makes suggestions; the department makes suggestions; the minister would have his or her own views; and the final program is a reflection of all of those inputs.

Senator EDWARDS: Okay.

Proceedings suspended from 10:29 to 10:45

CHAIR: We will resume.

Senator RHIANNON: Mr Varghese, I note that at the Senate inquiry last Friday you gave evidence. You said words to the effect that aid could only be effective if it was aimed at promoting economic growth. I thought about this and remembered some of the comments from the UN Secretary-General in the context of the Millennium Development Goals, where he stated, in 2010:

While economic growth is necessary, it is not sufficient for progress on reducing poverty.

Could you comment on that? Do you disagree with the approach of the UN Secretary-General?

Mr Varghese : When we had this discussion in a different context last Friday, the point I was making is that, if you want a sustainable reduction in poverty, the best way to achieve it is through economic growth. That is quite different from saying that there is no place in the aid program for anything other than economic growth strategies, because clearly, to take one example, emergency humanitarian relief is something which is a very important part of our aid program, and I do not think anyone presents that as an economic growth strategy. I do not think there is necessarily any huge difference between what I was saying then and what the secretary-general is quoted as saying.

Senator RHIANNON: Have you read the United Nations Millennium Development Goals?

Mr Varghese : Some time ago.

Senator RHIANNON: Have you read them since the integration started between AusAID and DFAT?

Mr Varghese : No, I have not.

Senator RHIANNON: Could you take on notice to provide the committee with a statement clarifying exactly how the department intends to promote economic growth that is sustainable and that takes into account other social and structural factors that impact on the poverty of the most vulnerable and poorest people?

Mr Varghese : I think it has been very clear from what the Foreign Minister has said and what the government has said on just where the promotion of economic growth is going to sit in our aid program. It is going to be a central pillar.

Senator RHIANNON: I was just asking for you to take it on notice because we are short of time. If it is not possible to take it on notice—

Mr Varghese : I am happy to answer the question now rather than take it on notice.

Senator RHIANNON: If you could. If you cannot take it on notice, could you take on notice to indicate—

Mr Varghese : No—what I am saying is I do not need to take it on notice.

Senator RHIANNON: those statements that respond to that question?

Mr Varghese : I am very happy to respond to your question. I do not need to take it on notice.

CHAIR: Excellent. Would like to respond?

Senator RHIANNON: I was just asking, because of shortage of time, for you to take it on notice.

Senator Brandis: Senator Rhiannon, that is not the way this works, by the way. You ask a question and, if the official is prepared to give you an answer, then he has to be given the opportunity to give you an answer. If he feels he needs to take it on notice, he may. You know that there is a question on notice procedure that you can avail yourself of, but, if you come to these estimates and ask a question, not only are you entitled to an answer but the official of whom the question is asked is entitled to answer.

Senator RHIANNON: Yes, and I think—

Senator FAULKNER: Can I add to that, Minister? I think if the official knows the answer, they actually should provide it.

Senator Brandis: I agree with you, Senator Faulkner.

Senator FAULKNER: I think it actually goes further than that.

Senator Brandis: I think Mr Varghese was trying to give the answer.

CHAIR: I gather from what he has said that the witness is happy to give you an answer, Senator Rhiannon. Let us let him do that.

Mr Varghese : The government has made very clear that a central objective of our aid program is the promotion of economic growth in order to have a sustainable reduction in poverty. That will be achieved in a number of ways. It will be achieved through a greater emphasis on aid and trade. By that I mean the use of the aid program to build up the capacity of developing countries to engage in the global trading system in a way that will contribute to their economic growth and raise their standard of living. It will include a greater role for the private sector as the driver of economic growth—so looking for ways to promote the role of the private sector, including in innovative ways and using technology. It will also mean that this benchmarking exercise that we have set out on, and that Senator Mason is leading, will address prominently the role that economic growth plays in contributing to poverty alleviation and how you benchmark success on that path. That is the core of the government's approach.

Senator EDWARDS: Secretary, could you please give me the cost of the foreign minister's travel for their first five months for each of the immediate past foreign ministers?

Senator Brandis: Which foreign ministers do you mean?

Senator EDWARDS: Minister Bob Carr and Minister Rudd—the cost of their travel in the first five months of their terms as foreign minister. I would also like the cost of the current foreign minister's travel from her first five months.

Mr Roach : Firstly, the travel costs of the current foreign minister, Ms Bishop—and indeed that of all ministers—have not yet been provided by the Department of Finance. You might recall that we spoke last time about how, when it comes to the cost of overseas travel—travel by ministers, all ministers—that is handled by the Department of Finance. They table a report every six months to say what the costs have been. The last tabling in parliament of documents by the Department of Finance was done in December 2013. That only dealt with costs up until the end of June 2013. So we do not have any costs past that date. With respect to the cost of travel by—

Senator EDWARDS: You are talking about a reporting period. I am just interested in knowing the spending by former foreign ministers Rudd and Carr, and now current foreign minister Bishop, in the first five months of their ministries.

Mr Roach : We will be able to provide that for a six-month period—

Senator EDWARDS: Okay, six months then.

Mr Roach : for Mr Rudd and for Senator Carr. I cannot give you those at the moment, but we can look at what was done by the Department of Finance for those reporting periods. For the current foreign minister, we will need to wait for the publication of the next statistics. I do not think we will see those until June. As I said, it is the Department of Finance that monitors and collates those costs.

Senator EDWARDS: I am interested in those figures. But, more particularly, I want to know if the spending patterns of the previous two foreign ministers during their initial periods of incumbency are at variance with the current minister's.

Mr Varghese : I think the most useful thing would be if we took that on notice. We would be sensible to give you a sense of that comparison after we have done the work on it, bearing in mind the point that Mr Roach made about when the first six months the current foreign minister's expenditure will be available to us.

CHAIR: I think we will take Mr Varghese's advice.

Senator EDWARDS: I am concerned that I have not been clear. You account every month, you pay bills every month, not every six months, so you should be able to get the first five months costs.

Mr Roach : We do not actually pay the bills for the foreign minister's travels.

Senator EDWARDS: Somebody does.

Mr Roach : Yes, the Department of Finance.

Senator Brandis: I take it Senator Edwards that you have settled on this five-month period because Ms Bishop has not actually been in the portfolio the six months. The government was sworn in on 18 September, I think.

Senator EDWARDS: Correct.

Senator BRANDIS: I assume that you have settled on five months to take us to the most recent monthly anniversary of the swearing-in of the new government.

Senator EDWARDS: Thank you for your help.

Senator Brandis: If I understand you correctly, you want to know how much Mr Carr spent in his first five months as foreign minister on foreign travel, how much Mr Rudd spent on foreign travel in his first five months as foreign minister and how much Ms Bishop has spent on foreign travel in her first five months as foreign minister. Is that the question?

Senator EDWARDS: Crystal clear. Thank you very much.

Senator Brandis: I think it is a notorious fact that when Ms Bishop became the foreign minister she chose, unlike her predecessors, to travel business class rather than first class. I believe she even travels economy class on some occasions. No doubt that greater economy in the class of travel will be reflected in those figures.

Senator EDWARDS: In this time of restraint, I am very interested to see whether the departments are actually carrying out what they are espousing. That is why—

Senator Brandis: We will take it on notice.

Senator RHIANNON: Mr Varghese, is it the intention that the current integration of AusAID into DFAT will also integrate the humanitarian multilateral development and partnership in development policy divisions?

Mr Varghese : The intention of the integration is to integrate, and we are well advanced in the process of doing that.

Senator RHIANNON: Just to clarify, will they be integrated or will they be diffused? Could you be specific about how you are going to retain that expertise.

Mr Varghese : We will retain a separate division dealing with multilateral and humanitarian issues.

Senator RHIANNON: So only multilateral and humanitarian issues out of those divisions—

Mr Varghese : I think that is what you asked about.

Senator RHIANNON: because I understood there was the partnership in development policy division as well.

Mr Varghese : Yes, and that will also be retained.

Senator RHIANNON: How many staff have resigned or taken a redundancy since 1 November?

Mr Varghese : We have put out an expression of interest for voluntary redundancies at the non-SES level. Some 350 people have responded to that expression of interest. In other words, they have indicated that they would be interested in pursuing one. We are in the process now of putting together, as we are required to, estimates of what a redundancy package would consist of in each case. That is actually quite a time-consuming process. We are doing that progressively, so each week we make some more costed offers. So far, we have offered final packages that have been accepted to 26 of those who have responded. We will work our way through the numbers—

Senator RHIANNON: So that is 26 of the 350. How many months are part of the redundancy package, please?

Mr Varghese : Sorry, what do you mean by 'how many months are part of the redundancy package'?

Senator HEFFERNAN: How many months pay—12 months, two years, six weeks?

Mr Varghese : It is the standard—

Senator HEFFERNAN: What is the standard?

Mr Varghese : My recollection is that the standard is two weeks per year of service up until a ceiling which I think is less than 52 weeks.

Senator RHIANNON: Prior to the integration, the Office of Development Effectiveness reported directly to the Director-General of AusAID. I understand that they now report to a deputy secretary within DFAT. Can you confirm that change and explain why the ODE does not report directly to the secretary of the department.

Mr Varghese : Under AusAID it made sense and it was practical for that office to report directly to the Director-General. In an amalgamated department, which of course is a much bigger department, the direct reporting lines to the secretary are obviously going to be and look very different. The decision we came to was that the Office of Development Effectiveness would report to a deputy secretary, and I think in the circumstances that makes sense.

Senator RHIANNON: You said, 'we came to the decision'. Did you make the decision?

Mr Varghese : Ultimately I made the decision, but all of these integration decisions go through quite a well-structured process which involves the task force making recommendations to a steering committee, which I chair, and that steering committee then making decisions.

Senator RHIANNON: What strategies are being adopted in the integration of the country programs to attain development expertise within the structure and also the staffing?

Mr Varghese : I made it very clear from the beginning that while we wanted to pursue integration to the maximum extent possible we would not do so at the price of the loss of essential expertise. The way we have done this is, in the geographic divisions we have sought to integrate to the maximum extent possible, but in the areas of functional and specialist expertise we have retained separate divisions. So, even within the integrated geographic divisions there will be people with a very substantial development assistance background.

Senator RHIANNON: Thank you. I did want to ask questions about some of the environment programs. I did not want to get into specifics but just to get your advice because I am still trying to understand the new system. Is now the time to ask them because I could not actually see on the program where the questions would come later?

CHAIR: That is under development assistance, I think.

Senator RHIANNON: When you get to development assistance we start to get into specifics of each country and I could not see where the general environment questions would come. Can I ask them now?

CHAIR: I think it is 1.10 to 1.12 and you are down for all of those.

Senator RHIANNON: I know I am down for them.

CHAIR: I think they are specific. This is a general section. That is where you should ask those more specific questions.

Senator RHIANNON: I cannot see where the environment is coming in on any of those specific programs later in the day.

CHAIR: I will ask the advice of the secretary.

Mr Varghese : Senator, we would be happy to field questions on the environment if that is convenient.

Senator RHIANNON: Okay, so I will keep going. Can you detail the exact programs and projects and the countries in which they operate that will be affected by the elimination of all funding to global environment programs from the $650 million in cuts announced in January?

Mr Varghese : I think we covered some of the principles behind this in a separate inquiry. We are working through the detailed consequences of the cuts that the government has announced to the current financial year aid program. That requires us to talk to our bilateral country partners and it requires us to talk to the multilateral organisations that are affected. That process is continuing and when it is finished we will have an answer to your question.

Senator RHIANNON: As you say, that is what you told us last Friday. But surely you are able to share more information. We know you had to arrive at a figure of $650 million. There is four months to go. There must be some work on this very issue that is locked in that you can share with us now.

Mr Varghese : There is a lot of work that is going on. I will ask Mr McDonald if there is anything in that category of locked in, as you put it, that we are in a position to share with you.

Mr McDonald : In relation to your comment about the $650 million, I think it is important to clarify that in relation to the global environment program the actual reduction occurred in the 2013-14 budget because of the end of a lot of the Fast Start money, so it was not actually part of the reprioritisation. It was a very small proportion that is part of the reprioritisation. Equally that occurred in our climate change and environmental sustainability line. Those substantive reductions in those had occurred in the 2013-14 budget. As part of the reprioritisation they have been reduced a little more. We are going through the consultation process now in relation to what they mean in terms of the programs we deliver.

Senator RHIANNON: Will you be funding any of the multilateral climate change funds whether it is part of the aid program or from elsewhere in the national budget? I was referring there to the Adaption Fund, the Least Developed Countries Funds, the Global Environment Facility, the Climate Investment Funds, and the Green Climate Fund. I do understand that the decision on those would have been made by now.

Mr McDonald : In terms of the multilateral funding, as I said, they predominantly expired at the end of the 2012-13 budget. In terms of the actual reprioritisation for this year there was actually no money in relation to that in the budget. Those issues need to be decided as part of the 2014-15 budget and beyond. I want to be clear that that is not money that has been taken out through the reprioritisation process. It has not.

Senator RHIANNON: To clarify, you are saying that the decision was obviously made on 2013-14 and for 2014-15 are you saying that there no decision or no money?

Mr McDonald : There are three things that have occurred. There is the 2013-14 budget that was put in place by the previous government. There is the reprioritisation process that the current government has recently announced. Then there is the 2014-15 budget process which is currently under way. They are the three bits. For future priorities in the program they will be part of the 2014-15 budget process.

Senator RHIANNON: I am trying to understand. Has the department altered the methodology used to account for climate finance within the aid budget? Maybe you can explain what the current methodology is, please.

Mr McDonald : I might need somebody with more technical expertise than me for that. Can I say that the methodology has not changed.

Senator RHIANNON: Hasn't changed?

Mr McDonald : No. In terms of our Fast Start commitments that were made under the previous government, they have been met. That is why that funding has ceased. In terms of the actual funding that is counted towards climate and environment as part of our bilateral programs, I do not believe that methodology has changed at all.

Senator RHIANNON: What I was also specifically after is what measures are taken to ensure there is no double counting of aid money and climate finance, because you would be aware that that is where there has been some controversy? I was also interested in that specific point.

Mr McDonald : I am not aware of the controversy that you are referring to.

Senator RHIANNON: I will just ask the question then. How are you ensuring that there is no double counting?

Mr Varghese : Perhaps Blair Exell could respond to that.

Mr Exell : Overall through the aid program there is a system of coding that we use to count our expenditure against various items. That is the method we use to make sure there is not double counting across a range of things, whether it be health, education, infrastructure or climate related activities. That has not changed.

Senator RHIANNON: Thank you. On the graduate program, is there any intention to retain a development stream within the graduate program and career development of employees of the department?

Mr Varghese : We will have, in effect, a development stream running through the department post integration, because it is a key part of the portfolio and we want to ensure that we have as good expertise as possible. Just as we have officers in the department who have over the course of a career developed specialisation in trade negotiations, in legal issues, and in strategic non-proliferation disarmament issues, we will have a cohort of officers who have expertise in development assistance.

Senator RHIANNON: Mr Varghese, the question was specifically on the graduate program. I note you are saying that there will be a development theme running through. But to go back to the specific question again: will there be a development stream within the graduate program?

Mr Varghese : We recruit graduates to the Department of Foreign Affairs and Trade, and we train them during their graduate period to do the work that the Department of Foreign Affairs and Trade does—of which development cooperation and development assistance is a major component. They will be trained accordingly.

Senator RHIANNON: Back to climate change: what will be the value, in terms of grant equivalent, of Australia's total support for climate change mitigation and adaptation overseas?

CHAIR: Senator, with respect: that is under section 1.4; this is the general section. So we might ask you to come back with these questions under 1.4.

Senator RHIANNON: Okay. Of the former AusAID staff who have either resigned or taken redundancy since 1 November, could you provide a breakdown of the number who filled specialist roles versus generalist roles?

CHAIR: Again, Senator: these are questions which are coded for further in the program. We are doing general inquiries now, and I think—

Senator RHIANNON: I made that inquiry at the beginning of my questions because there is obviously confusion about how we are breaking up our questions. I am happy to do it later, but it was not suggested where it will be.

CHAIR: I suggest you do that later, under program 1.4 and thereon.

Senator RHIANNON: No, 1.4 is specifically climate change. I was just asking about restructuring issues.

CHAIR: I think it is a fine line, Senator—and we need to get through the general sections so that we can move into the specifics. There is 1.6, 1.7, 1.8, 1.9.

Senator RHIANNON: My question had nothing to do with climate change, Chair.

CHAIR: I would really prefer you to come back and ask them later on, when we get to those areas, if you do not mind.

Senator RHIANNON: Can I ask my general question, Chair?

CHAIR: I am not sure that it was a general question.

Senator RHIANNON: It was just about redundancy and the restructuring.

CHAIR: That sounds like a specific question. I would like you to come back later and ask these questions under those programs so we can complete the general section. We have time to make up.

Senator RHIANNON: If you can make time when I can ask those restructuring questions later, I am happy to do that. If you can advise what program that is under, it would be helpful. At the moment I cannot see what it comes under. It is certainly not 1.4; 1.4 is climate change.

CHAIR: All right, you can ask that question.

Senator RHIANNON: So I can ask it?

CHAIR: You may, yes.

Senator RHIANNON: Thank you, Chair. Mr Varghese, of the former AusAID staff who have either resigned or taken redundancy since 1 November, could you provide a breakdown of the number who filled specialist roles versus generalist roles?

Mr Varghese : We have made offers of VR to 26 people. Are you are asking how many of those 26 people were former AusAID officers and, within that category, how many were specialists?

Senator RHIANNON: Yes.

Mr Varghese : It will raise some definitional issues, but we will certainly take that on notice.

Senator RHIANNON: Could you also provide a breakdown of the staff who have either resigned or taken redundancy since 1 November on the basis of the agency or the department that employed them prior to the integration?

Mr Varghese : Yes, we could do that.

Senator STEPHENS: I just wanted to go back to the discussion about the new structure of the department. We had a conversation in the other inquiry, last Friday, about the balance of poverty reduction and sustainable development. I want to ask you quite specifically: can you advise the committee why the breakdown of country groups under outcome one has been changed?

Mr Varghese : The breakdown of country groups?

Senator STEPHENS: Yes. Previously Africa was grouped with South and West Asia and the Middle East; now the Americas and Africa are one group, and South and West Asia and the Middle East is another.

Mr Fisher : I think you might be referring to re-structuring within the department, where different parts of the department have been brought together in different structures. The FTE will flow with those new structures.

Senator STEPHENS: So the FTE will go with those structures?

Mr Fisher : That is correct—we readjust the FTE to account for those changes.

Senator STEPHENS: Last week, Mr Varghese and Mr McDonald, we talked about trying to get to the nub of what programs across what countries would be subject to the $650 million cuts, and you undertook to get some information to us today. Can you bring us up to speed, please?

Mr Varghese : I do not think there is anything further to report between last Friday and today. As I indicated at that time, this process of consultations is likely to take a bit of time. Let me just put this in some context. The last time the government did this, which was under the previous government—in other words, made reductions in the aid budget in the course of a financial year—there was a gap of a little bit over two months between the announcement of the quantum of reduction and the details of where those reductions were going to apply, and I think we are probably dealing with a similar period of consultation and decision making in this case. I am sorry I am not able to give you more detail than I was able to last Friday, but I suspect that even next Friday the position will not be much different.

Senator STEPHENS: Can you advise the committee that when the minister was visiting Fiji, Papua New Guinea, the Philippines, Malaysia, Cambodia and Vietnam these issues were raised there?

Mr Varghese : I am sure the minister would have had discussions about the aid program. But those discussions would not have gone into the detail of what programs were going to be adjusted in what way to reflect the savings that were announced earlier this year. That would be something for officials to take forward.

Senator STEPHENS: Am I to understand from your comment today that we are not likely to get the detail of the impact of these cuts across countries until before the budget?

Mr Varghese : They may well be available before the budget is brought down—they may well be available around March—but I do not want to commit to a particular date, because it is a process over which I do not have total control.

Senator STEPHENS: I appreciate that. But do we need to formally ask you on notice to provide that information to the committee as soon as it is available?

Mr Varghese : We would be happy to share it with the committee as soon as it is available.

Senator STEPHENS: I was not too sure whether that would be when it became publicly announced or whether the committee was able to receive—

Mr Varghese : We are working on the basis that, once it is all worked out, we would put it on our website.

Senator STEPHENS: Okay. Sometimes we get information through the committee process before it goes on the website.

Mr Varghese : We could make a special arrangement, Senator!

Senator STEPHENS: You made comments at the inquiry, too, about the submissions that express concern about aid for trade. Can you elaborate for the committee—for those members who not there last week—how aid for the purpose of Australia's security and economic gain is different from aid programs for poverty reduction and charity and how the government is now approaching this issue?

Mr Varghese : I think this is a set of interconnected issues. Economies that are growing, particularly economies in our region that are growing, pay a dividend to Australia in foreign policy terms and pay a dividend to Australia in economic terms. I do not think you can hermetically seal these different aspects of the program. We want an aid program that focuses on economic growth, and part of the path to economic growth is the capacity of a country to engage in the international trading system. The so-called aid-for-trade emphasis is: how do we use our aid funding to strengthen the capacity of countries to engage in the international trading system? That can include the sort of infrastructure a country needs to trade, whether it be ports or roads or telecommunications. It can obviously include the policy framework that they have in place, the regulatory regimes that they have in place, the behind-the-border barriers that they have in place. There is a panoply of areas that are relevant to aid for trade, and under the DACC guidelines these are defined. We want to see an increase in the proportion of our aid budget that would be captured by that broad category.

Senator FAWCETT: Mr Varghese, could you compare for the committee the process that is being undertaken at the moment around prioritising how we are engaging with our stakeholders in the region and beyond in prioritising the spend of aid compared to what happened when the $375 million was diverted for looking after onshore detention of asylum seekers. Was a similarly structured and a strategic process undertaken then?

Mr Varghese : I am not going to go into the budget cabinet decisions of the previous government.

Senator FAWCETT: I am talking about your department, though, and the then AusAID. Did they apply a structured process to work out how to reallocate the remaining funding?

Mr Varghese : That was a preintegration period, and I was not personally involved in it. I do not know whether Mr McDonald, who was working in AusAID at the time, might be able to add anything.

Mr McDonald : The process was very similar to the process we are going through now, in the sense that, as we do with any budget process, we went through and had consultations with partner countries on the impact of any adjustments to the budget. That is what we are going through now. From memory, regarding the point that Mr Varghese made earlier about the time period, that occurred towards the end of 2012. I think there was a media release in December 2012. There were details of the country reductions provided in early February through the additional estimates process here, and there was an update of our website towards the end of February, from memory. That is the sort of period of time that it has taken to go through and have these discussions and agree how the program would be changed.

As I said at the inquiry the other day, the reason these are so important is that we need to agree jointly on what those priorities are and then we need to work out whether we can defer some of the payments, for example, and what programs would be reduced, in agreement with those partner countries. The process is very similar, in the sense that we are going through a consultation process, and that gives an appreciation of the time period required to do that across the board. Of course it needs to be done in both a consultative way and in a way that we actually look very closely at how we can minimise the impact of those reductions.

Senator STEPHENS: Can I move on now to ministerial travel. We had some discussion with Senator Edwards about the cost of ministerial travel. It is interesting, with a new minister in a new government, to understand how many days the minister has actually travelled overseas. Perhaps you can provide us with some details on this. How many days has she been away?

Mr Varghese : I will just ask Mr Roach if he can help us with that.

Mr Roach : Since Ms Bishop was sworn in she has undertaken 13 official visits, she has been to 26 countries and she has been away for 74 days.

Senator STEPHENS: Who travels with the minister? How many staff?

Mr Roach : Primarily, the minister travels with one adviser. She has taken one adviser on seven of those 13 visits. There have been four trips in which she has taken two advisers and there have been two legs of visits in which a second adviser has joined her.

Senator STEPHENS: Do any departmental staff travel with her as well?

Mr Roach : Yes, the rule of thumb is that one departmental officer would accompany the minister.

Senator STEPHENS: So one departmental and one adviser.

Mr Roach : That is right, as a rule of thumb. Of course, it depends ultimately on what the purpose of the travel is and those sorts of factors. For instance, travel to go to a major multilateral conference would require some more support staff.

Senator STEPHENS: Would the adviser be from the minister's office or from the Prime Minister's office?

Mr Roach : The FMO, the foreign minister's office. My use of the term 'adviser' means someone from the office.

Senator STEPHENS: Can you advise us of whether or not she has also been accompanied by officers from the PMO?

Mr Roach : Not to my recollection.

Mr Varghese : Sorry, Senator. Could you repeat the question.

Senator STEPHENS: I asked: has Minister Bishop been accompanied by an adviser or an officer from the Prime Minister's department or the Prime Minister's office?

Mr Varghese : I can think of one occasion where an officer from the Prime Minister's office did accompany the minister on a visit.

Senator STEPHENS: Which one was that?

Mr Varghese : To Indonesia.

Senator STEPHENS: Can you advise who the officer was from the Prime Minister's department?

Mr Varghese : It was the Prime Minister's national security adviser.

Senator DASTYARI: Mr Shearer?

Mr Varghese : That is right.

Senator STEPHENS: Thank you. In relation to the minister's travel, have the posts been asked to arrange cultural visits or other visits external to the formal meetings that the minister might have been involved in?

Mr Roach : No, there are no requests of that nature. We spoke a little bit earlier this morning about the way that ministerial programs are developed between the post, the department and the office. These sorts of visits may be added if there is the room and liberty in a program that is opened up, for example, by airline schedules, but there is no standing request to look at such opportunities.

Senator STEPHENS: I was not suggesting that; I was just asking whether or not during Minister Bishop's visits overseas she has—

Mr Roach : Has she undertaken—

Senator STEPHENS: Yes.

Mr Roach : Yes, she has, and indeed we answered a question on notice to that effect from the last—

Senator STEPHENS: Thank you. Can you tell me what number?

Mr Roach : Because I got so many last time, I will have to take that on notice.

Senator STEPHENS: No, do not do that. We will scan them and find them. I understand that Minister Bishop had a bit of a phone bill shock while she was overseas. Can you elaborate on that a little?

Mr Roach : I will do so to the best of my recollection. There was a phone bill shock, to use your term, when she first came into office. That was queried with the carrier concerned, who advised that they had mischarged in terms of the number of bytes that had been used by Ms Bishop's phone. The bill was incorrect and it was reissued at a significantly lower amount.

Senator STEPHENS: Could you take on notice advising us of the original amount and the revised cost of that telephone bill.

Mr Roach : Yes, I will take that on notice.

Senator STEPHENS: And whether or not her staff also experienced the same telephone bill shock. That would be helpful to know. As well as cultural visits or other activities, can you advise us of whether Ms Bishop requires embassy staff to go jogging with her every morning.

Mr Roach : No, she does not require someone to go jogging with her. The foreign minister likes to go running in the morning.

Senator Sinodinos: It would be a pleasure to go jogging with her. It would not be—

Senator STEPHENS: I could see you doing it! Sorry, Mr Roach, you were saying?

Mr Roach : No, I think that is a pretty good summation: staff voluntarily choose to join the minister for that jog.

Senator STEPHENS: Quite seriously, can you explain what happens if Ms Bishop, as a senior minister and a woman, goes jogging and there are no embassy staff go with her?

Mr Roach : My understanding is that there are always people prepared to go jogging with the foreign minister, so it is a hypothetical.

Senator STEPHENS: No, it is not a hypothetical. I am actually asking about her personal security.

Mr Roach : When the foreign minister travels, there are things that are very carefully thought through, such as the security of the environment and what security precautions are required. It is the case that these things are looked at and the minister's office is advised as to what those precautions are. If we were travelling to a post where, for example, it was not wise for the foreign minister to go jogging for a particular reason, then that would be conveyed.

Senator STEPHENS: It is very important that we have our first female foreign minister. Can you advise what other arrangements the department has had to put in place because of her gender. That would be quite helpful for us to understand.

Mr Roach : My area of responsibility is to look after the travel preferences of ministers. In terms of gender, I cannot think of an issue that has been raised that has required particular treatment.

Senator STEPHENS: I was going to say that is because you are a bloke, but it is okay.

Mr Roach : You are correct.

CHAIR: That is a very sexist remark.

Senator STEPHENS: No, it is not a sexist remark. I think there are particular challenges for senior women travelling overseas and I would have thought there would have been some thought given to supporting Ms Bishop's travel overseas.

Mr Roach : Perhaps that is handled in a more discreet fashion such that departmental officials do not need to become involved and therefore do not need to talk about such things.

Senator Sinodinos: It is on a need-to-know basis!

Senator STEPHENS: I have heard stories of previous ministers in various jurisdictions requiring a good bottle of Scotch to be in their room when they arrive. Has Ms Bishop asked for any specific requirements for her travel?

Mr Roach : All ministers regardless of their—

Mr Varghese : I can tell you that the minister has not requested a good bottle of Scotch.

Mr Roach : Yes. The point I was going to make is that ministers of all political persuasions work extremely hard when they go overseas, so we talk to them about particular things that we can do to make the travel and the demands easier. Ms Bishop's preferences have been the subject of an FOI request and those are out there. It does not include bottles of Scotch in her room.

Senator STEPHENS: I was not suggesting that for one minute.

Senator FAWCETT: Chair, I have a point of order. In all the time that we had a female Prime Minister—the first ever—I do not think you ever heard this committee ask questions about special arrangements put in place for her versus a long string of male prime ministers. I am not sure that this line of questioning is actually in order.

CHAIR: It is trivial, to be quite frank.

Senator STEPHENS: No, it is not trivial. For those of us who have had to travel in awkward countries you would understand that that is not trivial. I am only ensuring that the minister is being well looked after, nothing untoward. Moving on, Mr Varghese, can you bring us up to speed with where things are at with posts and vacant posts.

Mr Varghese : You mean heads of missions or—

Senator STEPHENS: Yes.

Mr Varghese : Where things are at is: we have a continuous system which advertises head of mission vacancies, invites expressions of interest, makes recommendations to the minister and, after further consideration by the minister and the Prime Minister, appointments are made.

Senator STEPHENS: Just in relation to the US ambassador's position, which is currently held by Mr Beazley, when does his term expire?

Mr Varghese : At the end of this year, or maybe January next year. I would have to double-check, but it is December-January.

Senator STEPHENS: Can you advise how often heads of mission posts are extended? Does that happen very often?

Mr Varghese : Quite frequently. In fact, my preference in general is to move towards a system of four-year postings rather than three-year postings for career appointments, because I think there are some strong arguments for doing that in terms of the returns we get on the investment in the posting. It is certainly not uncommon for a three-year posting to be extended into a four-year posting.

Senator STEPHENS: I know that Minister Bishop and Mr Abbott, as well as the former Prime Minister and foreign minister, hold Mr Beazley in high regard. I wonder if there are candidates to take over from Mr Beazley, or—

Mr Varghese : I am not going to get into the processes for—

Senator STEPHENS: No, sorry, I was not asking you to specifically name them. If his term is finishing now, when would the recruitment process be started to be put into place for his replacement?

Mr Varghese : We typically advertise twice a year; we advertise forthcoming posts twice a year. We normally look out around 18 months—I stand to be corrected—unless there is a particular requirement for language training, in which case we may look out a bit further. As part of that routine process, Washington would have already appeared on a forward list.

Senator STEPHENS: So it has already been advertised?

Mr Varghese : Internally.

Senator HEFFERNAN: Are you interested?

Senator STEPHENS: New York, New York! Just going then to the New York Consul-General, the announcement was made last week by the minister that former senator Minchin has been appointed. When is he likely to take up his post?

Mr Varghese : I think he is going to take it up at the end of the April or the beginning of May.

Senator STEPHENS: And Mr Downer?

Mr Varghese : Mr Downer does not occupy a diplomatic post.

Senator STEPHENS: So the media expect speculation, which I am not asking you to confirm or deny, about Mr Downer going as UK High Commissioner—who is currently in that position?

Mr Varghese : Mike Rann is currently our High Commissioner in London.

Senator STEPHENS: So the positions are all very highly contested, of course. When is that position likely to be vacant?

Mr Varghese : The normal term for non-career appointments is three years. Mr Rann, as I recall, commenced his posting in December 2012. So he has been there now for 14 months.

Senator STEPHENS: Are there many occasions that you can point to where the government has revoked positions?

Mr Varghese : It is not a question of revoking positions.

Senator STEPHENS: Or truncating an appointment, even.

Mr Varghese : Postings are truncated not infrequently for operational reasons and for other reasons.

Senator STEPHENS: Might 'for other reasons' be to accommodate someone's ambition to take up that post?

Mr Varghese : I do not know if we truncate to accommodate ambition—

Senator STEPHENS: Don't you!

Mr Varghese : but we might truncate to accommodate a decision that the government has made.

Senator STEPHENS: Seriously though, there have been a very significant number of changes in diplomatic head of missions and decisions that have been made by this government. What is the actual cost of that kind of diplomatic musical chairs—changing heads of missions—that goes on? Tell us what costs are actually incurred in bringing people home early, shifting people or having to change career diplomats' appointments so that they then have to go into a different language training program? How does this all work out?

Mr Varghese : It would depend on the circumstances. It would depend where in the posting cycle the change occurs, whether posting years and what the family composition of the person coming and going is. There are a whole range of factors. We are a foreign service which means people are coming and going all the time to postings and we absorb the costs of that. It is not a cheap thing to do but it comes with the territory.

Senator STEPHENS: Can you explain language training and how that operates to the committee? Do spouses get assistance with language training?

Mr Varghese : We have language designated positions. They are positions to which we ideally want to send someone who is fluent in the language. That can involve language training of up to two years. If it is a difficult language, it might take two years of full-time language training and a proportion of that would be in country. In addition to that, we offer survival language training to people who are going on posting but not occupying a language designated position. Officers are encouraged while at posting to undertake part-time language training within the budgets of the post and of the language training area. I think we do make a language training available to spouses, subject to an overall budget. I stand to be corrected on some details if that is not correct.

Senator STEPHENS: Mr Fisher, are you able to provide us with a list of vacant posts and advice on posts that will notionally fall vacant between 2014 and 2015, so those that have been advertised and those where terms are almost expiring?

Mr J Fisher : Are these head of mission or head of post?

Senator STEPHENS: Head of mission.

Mr J Fisher : We can certainly take that on notice.

Senator STEPHENS: Thank you.

Mr Varghese : That is going into a lot of our internal processes. I am not questioning your request, but the comings and goings and dates of our officers are largely an internal management issue, but we will take it on notice.

Senator STEPHENS: Thank you. There are career diplomats who are coming to the end of their term and we are expecting back in Australia. You must have a sense of how many there are and where they are.

Mr Varghese : Sure, we do.

Senator STEPHENS: I have a final question in diplomatic posts. The government has shifted its focus away from Africa in the $650 million in cuts. One of the things that is in the estimates statement is not going ahead with the diplomatic post in Senegal. Who covers that area now?

Mr Varghese : I have to check which particular African post has responsibility for Senegal.

Mr J Fisher : We can get back to you on that.

Mr Varghese : There may be someone in the room who knows. Accra covers Senegal.

Senator STEPHENS: Can you remind the committee why we have decided to discontinue the establishment of that diplomatic post?

Mr Varghese : My recollection is that it was part of savings announced by the then opposition before coming into government.

CHAIR: These are starting to be specific questions, Senator Stephens.

Mr Wood : It was announced in the Mid-Year economic and Fiscal Outlook. The closure of the diplomatic post in Senegal was contained in the government's pre-election costings document.

Senator STEPHENS: Thank you.

Senator HEFFERNAN: Has the Department of Foreign Affairs and Trade given any consideration to the redefinition of sovereignty that may occur if the revenue leakage, which is altering the way governments have to behave, continues? Last year there was about $3 trillion of tax avoidance through transfer-pricing in the Group of Eight, which could mean the redefinition of sovereignty as we know it. Or is that too hard and heavy?

Mr Varghese : It is not a question that I have an answer to.

Senator HEFFERNAN: You are not on your own.

Mr Varghese : I am not sure whether any of my colleagues present this morning have an answer, but there may be some colleagues present this evening who may be better placed to provide an answer.

Senator HEFFERNAN: Thank you. I just think it is something we have to think about. What is the world going to look like if we do not come to terms with it?

Mr Varghese : As you know, a big part of our G20 agenda is to push the tax issue.

Senator HEFFERNAN: There is another issue which I have raised in other estimates. You would be familiar with Mr Hunt who was arrested at the Darwin airport.

Mr Varghese : Is this the person who was on posting in Jakarta? Is that who you are talking about?

Senator HEFFERNAN: Yes, and recently there have been alleged incidents in Singapore to do with the trafficking and sale of images of internal children. There was an inquiry in 1996, which followed on from the episodes of Scoble and other people, that found that there was not an endemic subterranean issue in DFAT. Are you happy that that is still the case?

Mr Varghese : I have no reason to believe that there is anything approaching an endemic issue in the department in those areas.

Senator HEFFERNAN: Are you satisfied you are dealing with the issue even if it is not necessarily endemic?

Mr Varghese : Whenever any suggestion or allegation of behaviour of that sort is brought to our attention, I can assure you that we would deal with that very promptly and very effectively.

Senator HEFFERNAN: Do you feel that you are not captured by the institutional terms of the royal commission currently underway?

Mr Varghese : The department secretaries?

Senator HEFFERNAN: Yes.

Mr Varghese : I have seen nothing in the work of the royal commission or my understanding of its terms of reference which would capture the department.

Senator HEFFERNAN: So I take it then that you have not thought, talked or considered making a submission to the royal commission?

Mr Varghese : No, we have not.

Senator HEFFERNAN: I am leading to the fact that back in 1998 I called for a royal commission, which included the Salvos, and they all thought I was mad. You can only go through a denial phase for so long, and maybe we have that problem here.

Mr Varghese : I hope you are not suggesting anything.

Senator HEFFERNAN: No, I am not suggesting anything other than that you should have a look at it. Minister, the other thing I would like to put on the record—which has nothing to do with this but has a lot to do with the government—is that the new ASIO building is unsound and that windows keep falling out of it. Do we know why?

Senator Brandis: We do.

Senator HEFFERNAN: Why?

Senator Brandis: Strictly speaking, of course this is an Attorney-General's estimates matter. It was raised then on Monday. I inspected the building on Tuesday of last week for the first time, and there is a problem with some of the external windows which have fallen of the building. There have not been many. I was advised by the person who conducted the inspection that this is not a completely unfamiliar problem with this particular type of glass and that the problem settles so that—as it was explained to me, and I of course am not a builder, but I was told—if the windows have not fallen off within the first two years they are unlikely to fall off beyond that. And I do not know the figure, but it is a very small number—just five or six, I think, or three or four—and those of course have been replaced.

Senator HEFFERNAN: Thank you, but don't you think it indicates an engineering problem? This is allegedly the most secure building. It is $170-odd million over budget, it has air-circulation problems, it has a whole lot of structural engineering problems. It was opened last July. The windows are still falling off it, but hopefully in two years the windows will stop falling off it. We do not want to let the birds in, let alone the spies.

Senator Brandis: At the time the building was ostensibly opened by the former Prime Minister, Mr Rudd—I think it was on 23 July last year—the former government knew that the building was not in a condition fit to be handed over from the principal contractor, Lend Lease. But the former government decided to go ahead with the opening ceremony. The building still has not been handed over, so it is still in the custody of the contractor. And it is not expected to be handed over on the current time line until April or May of this year, I think it is, although that time line has blown out by more than a year. The windows themselves are not an aspect of the building's security, by the way. There is a perimeter fence and very sophisticated—

Senator HEFFERNAN: But they will let the magpies and the swallows in.

Senator Brandis: Well, I said 'external windows', because there are actually a couple of layers of windows. So, the lack of adhesion of some of the external windowpanes has not actually exposed the adjacent parts of the interior to the elements,

Senator HEFFERNAN: Is there a risk, though, to traffic under the windows—that they will drop on your head?

CHAIR: This is not a matter for this committee. It belongs in another committee.

Senator HEFFERNAN: No worries.

Senator Brandis: Well, I suppose if you were walking underneath the window that fell down, it might hit you.

Senator EDWARDS: I just want to finish a line of questioning from before we went to the morning break. I was questioning on former foreign minister Carr. We were talking about historical and cultural sites before we went to that break, and I would just be interested to know whether Mr Carr or his ministerial staff ever asked the department to include specific cultural or historical sites. We got to that question but we never finished the answer. Or perhaps we did—perhaps you took it on notice. Is that right?

Mr Varghese : Mr Roach may want to add to this. I think we explained that this is an iterative process, with suggestions coming from various points, including from the minister or the minister's office. So it would not be surprising if some of those visits reflected a wish expressed by the minister. But I could not tell you which ones and where.

Senator EDWARDS: Could anybody?

Mr Varghese : Well, it would involve a lot of work.

Mr Roach : I do not think we would be able to answer that.

Senator EDWARDS: Did Mr Carr ever extend the length of his official overseas visits for personal reasons—that is, a holiday?

Mr Varghese : My recollection—and I became secretary only in December of 2012—is that on the one instance when Senator Carr added to a visit, he did so by taking recreation leave.

Senator EDWARDS: So, during what visits did that take place? Which region? Which post?

Mr Varghese : My recollection is that that would have occurred after the G20 meeting in Russia.

Senator EDWARDS: How many days did he stay on afterwards, do you know?

Mr Varghese : I would have to check. He was on personal recreation leave, so—

Senator EDWARDS: But I assume he came back off that, so I am just interested to know when he came back off personal recreational leave.

Mr Roach : We have actually taken that question on notice. We are unable to answer because while Senator Carr was in St Petersburg at the G20 meeting there was the federal election in Australia. He was granted to take some leave time by the Prime Minister. He returned completely privately—

Senator EDWARDS: So he was on holidays while the country went to the polls.

Mr Roach : I do not know at what point that kicked in, in terms of the end of the St Petersburg G20 meeting, but to get to the question, he returned privately of his own volition without assistance from the Department of Foreign Affairs and Trade.

Senator EDWARDS: So he was in Russia in the lead-up to the last federal election and then stayed on, presumably. Did the department provide Mr Carr with any assistance on these additional days?

Mr Varghese : My recollection is we did not.

Senator FAULKNER: Recreational leave, or personal recreational leave: yes, ministers take leave. The terminology 'recreational leave' is all I would quibble with. Effectively, when a minister takes leave, personal leave if you like, this is leave that a minister can only take with the agreement of the Prime Minister. I think you would acknowledge that that is the case?

Mr Varghese : I was using a term that public servants use, and I am sorry that it does not apply—

Senator FAULKNER: I am using the terminology that politicians use. But the point is: if a minister takes leave, which they do—even ministers, just like public servants, as you would appreciate—every now and again, yes, they have a break. It is a terrible thing but they do. Ministerial leave, of course, is granted by the Prime Minister. First of all, do you acknowledge that process? I think everyone understands. When that happens, of course, it is a matter of course that there is an acting minister in any portfolio. I think that is the general process under the cabinet handbook, as I understand it. Could you acknowledge that?

Mr Varghese : That is my understanding as well.

Senator FAULKNER: What I am not as clear about, but I believe to be the case because, in another life many years ago, I regularly acted as minister for foreign affairs myself. And I did so when the then minister for foreign affairs was overseas. So it is also common practice, is it not, as I understand it—this would be useful for you, just so we get the full picture—when an Australian foreign affairs minister travels overseas there are usually also acting arrangements put in place when the foreign minister is outside the country. That is my understanding but if you could confirm that or tell me what the case is, I would appreciate it.

Mr Varghese : That continues to be the case for both the foreign minister and the trade minister. When they are outside the country another minister is appointed as an acting minister.

Senator FAULKNER: Thank you.

Senator EDWARDS: Did Mr Carr ever write to the Prime Minister seeking approval for an employee to travel first class with him? If so, when?

Mr Roach : I am not aware of any instance. We do not see copies of all correspondence between ministerial offices. I can undertake to look at our records to see if we have such an instance, but that is the best I can do.

Senator EDWARDS: So you can take it on notice. The fact that you are not aware does not mean it did not happen, but you can take that question on notice.

Mr Roach : Correct.

Senator EDWARDS: Could you also provide an answer as to whether the Prime Minister actually approved that request and when it was approved. Likewise if it was refused and when. While you are there, you might include the flight details as well and who it was that we are actually talking about that was requested for. My last one: did Mr Carr ever request the assistance of DFAT officials at a post to upgrade his flight to first class?

Mr Roach : Senator, firstly, under the arrangements that were in place, ministers were entitled to travel first class where the flight was for more than 10 hours. So, certainly, Senator Carr was entitled and did take first class flights—

Senator EDWARDS: I understand the entitlement. The question is quite specific, and I am not complaining, I am not a minister—

Mr Roach : I am just trying to clarify your question.

Senator EDWARDS: Did Mr Carr ever request the assistance of DFAT officials at post to upgrade his flight to first class?

Mr Roach : I will take it on notice, Senator.

Senator EDWARDS: If so, when? And what post received such requests from Mr Carr? And, of course, whether they were successful in gaining the upgrade.

CHAIR: I think that concludes the portfolio overview and will move on to program 1.1, which is foreign affairs and trade operations. Senator Dastyari, we are going to impose time limits, so please be focused in your questioning.

Senator DASTYARI: I will. I just want to go back to talk about the comments regarding the foreign minister and the foreign minister of China on 6 December last year. Could Mr Rowe come back, who was there on the day.

Senator STEPHENS: Senator Dastyari, we are going to—

Senator DASTYARI: China and North Asia.

Senator STEPHENS: The country groups.

Senator DASTYARI: That is fine. These are North Asia questions. So, Mr Rowe, there are a few things you said that I am interested in asking a few more questions on regarding that visit on the trip on 6 December. You made the point—these are your words and I am paraphrasing here, so correct me if I have misquoted you—that sometimes the Chinese tend to do these things to make a point. Can you elaborate on that? I am paraphrasing, I do not have the transcript, so they may not have been your exact words, but that was the sentiment.

Mr Rowe : We have seen before with the new ministers that there will be quite a robust discussion.

Senator DASTYARI: I was not there, but you were obviously there. Was anyone there from the Prime Minister's office?

Mr Rowe : No.

Senator DASTYARI: The foreign minister was there, yourself and who from the foreign minister's office?

Mr Rowe : I think it was Mr Hanson.

Senator DASTYARI: There were only the three of you and, I imagine, some other officials from the foreign ministry in China?

Mr Varghese : Senator, there would have been a number of people from the embassy. The ambassador would have been there, and embassy note takers and others would have been there as well.

Senator DASTYARI: The point you made was that the Chinese government would have been aware the media were there, and it was done as a demonstration to make a point. Is that fair to say?

Mr Rowe : Yes.

Senator DASTYARI: What was the point they were trying to make?

Mr Varghese : Senator, I think you would have to ask the Chinese that.

Senator DASTYARI: Let me put it this way. With something of that nature, there would be an interpretation that would be taken by DFAT. What was your interpretation of their intention?

Mr Varghese : I was not there, but I am very familiar with this issue, and I am very familiar with the foreign minister's visit. It is no secret that the Chinese did not agree with the position we took on the air identification zone. This was a point of some contention in the discussions we have had with the Chinese and it continued to be a subject of robust discussion during the foreign minister's visit to China. The remarks that the foreign minister of China made were consistent with that difference of view between our two countries on the proclamation of the air identification zone.

Senator DASTYARI: Mr Varghese and Mr Rowe, I suppose that you would acknowledge that it is not insignificant that the Chinese foreign minister, in front of the assembled media, would—I am using the language of the media here, not my assessment—publicly rebuke the foreign minister of Australia over a matter like that. That is a significant development, is it not?

Mr Varghese : I do not know if it was a significant development; it is—

Senator DASTYARI: It is not insignificant. It is significant enough for you to know about it.

Mr Varghese : I know many insignificant things, as well.

Senator DASTYARI: This is not one of them.

Mr Varghese : It is yet another expression on the part of China that they did not agree with the position we took on the air identification zone. I assume that the foreign minister of China wished that to be registered with the attendant media. It is more of the same, rather than something fundamentally different.

Senator DASTYARI: Let us take a step back. Mr Varghese, you made a point earlier about the Prime Minister's assertion of Japan being our best friend in Asia. We talked about the 'best friend' comment and also the use of the term 'ally'. Thank you for teaching me that an ally is an ally except when they are an ally, then they are not an ally.

Senator Brandis: No; that is not what he said. I think you know that is not what he said. Please do not mislead the witness.

Senator DASTYARI: I do not think I have the ability to mislead Mr Varghese; he is very, very good. Mr Varghese, you said before that it is a matter of priorities for the government. Was that your language? You used the word 'priorities'. I just want you to elaborate on what the priorities are when it comes to North Asia.

Mr Varghese : I think the point I was making was that successive Australian governments, in articulating their foreign policies, have referred to priorities, including priority relationships. This is not something new.

Senator DASTYARI: We are talking about ranking of nations in Asia. The language we have used about Japan in the past—correct me if I am wrong; you are the expert on this, not me—is that we have referred to them as our oldest friend. We have referred to them as a good friend. We have said that there has been no better friend, but we have never referred to them, in a formal, diplomatic sense, as our best friend in Asia. Is that correct?

Mr Varghese : I would have to check the historical record.

Senator DASTYARI: To your knowledge, is that correct?

Senator Brandis: He said he was going to check the historical record. What you are asking Mr Varghese to do is to confirm to you that a particular form of words has never been used. He cannot do that without checking the matter.

Senator DASTYARI: I will rephrase the question. Is that a term you have heard us use about Japan in your time as secretary, or in your time in foreign affairs?

Mr Varghese : I have only been secretary for a very short time. I have not heard it in the last 14 months, other than in the context in which you have raised it.

Senator DASTYARI: To take a step back from there, you talk about priorities, and governments making priorities. I think you have answered this question but I want to clarify it. That language was obviously a decision of the Prime Minister and foreign minister. Was that done based on the advice of DFAT or was that an independent political decision?

Mr Varghese : We do not normally go into the details of—

Senator DASTYARI: I am not asking for the details. I am asking whether you gave advice on that.

Mr Varghese : You are asking me to go into what advice we gave.

Senator DASTYARI: Did you give advice on those statements prior to those statements being made?

Mr Varghese : Those statements did not reflect any formal advice from the department. Nor would you expect them to. In the course of prime ministerial travel, prime ministers often front the press and often make comments—in response to questions or off their own bat. This is just a normal part of prime ministerial travel.

Senator DASTYARI: We were talking about this when you were talking about the Foreign Minister travels. I imagine when the Prime Minister travels there are DFAT officials that travel with him as well as officials from the Department of the Prime Minister and Cabinet. Is that correct?

Mr Varghese : It varies. In some cases a departmental official will travel with the Prime Minister. In all cases the Prime Minister has access to the relevant ambassador.

Senator DASTYARI: You are making the point to me that the decision to use this language was a decision for the Prime Minister and the foreign minister independent of the advice that was given, and no advice was given to that effect from DFAT.

Mr Varghese : I do not think I ever included the foreign minister in that.

Senator DASTYARI: Okay, the Prime Minister.

Mr Varghese : It was the Prime Minister's words.

Senator DASTYARI: And your point is that they were decisions of the Prime Minister. The Prime Minister is the Prime Minister. At the end of the day the Prime Minister is responsible for their own words. That is a matter for the Prime Minister. We take that up at a political level. My question is: what was DFAT's role in that?

Mr Varghese : DFAT did not play a direct role in it.

Senator DASTYARI: Would you often not play a role? I am not aware of us having a history of ranking our political—

Mr Varghese : I have been on many prime ministerial visits and I can assure you that every sentence used by a Prime Minister in a prime ministerial visit, particularly in dealing with the media, is not scripted in DFAT.

Senator DASTYARI: Have those comments made DFAT's job more difficult?

Mr Varghese : No.

Senator FAWCETT: I wanted to follow up on the issue of the response to the ADIZ declared by China. Could you outline for the committee the response by the Philippines, by Vietnam, by Japan, by South Korea, by Germany, by France, by the European Union, by the United States. And was there any significant variance of their responses to the response by Australia?

Mr Varghese : All of those countries expressed a view about the declaration. I think the consistent thread in that review was that the declaration was unhelpful and had been announced without prior consultation with the countries of the region. I think while the language used by each country is always different, they would be the common elements.

Senator DASTYARI: Is it fair to say that firstly we have never waded into the issue of the East China Sea before?

Mr Varghese : Of course we have.

Senator DASTYARI: In terms of a formal communique of that kind?

Mr Varghese : We have made formal and informal statements about territorial disputes in the East China Sea and the South China Sea.

Senator DASTYARI: Are you telling me there are other communiques of this kind that exist? Can you take it on notice? I am sure there are not. I am more than happy for you to take it on notice.

Mr Varghese : I am sure I can point you in the direction of formal statements made by Australian governments dealing with territorial disputes in the East China Sea and the South China Sea. There is nothing new in the sentiments expressed in that communique.

Senator DASTYARI: Is there a circumstance where we have done that and we have pulled an ambassador in on the same issue?

Mr Varghese : We call an ambassador in when we think there is a need to call an ambassador in.

Senator DASTYARI: There is a need in this case, but there is not a need in the case of the Yasakuni Shrine. Is that correct?

Mr Varghese : We did not call in the ambassador in the case of the Yasakuni Shrine.

Senator DASTYARI: No, we did not. That is my point.

Mr Varghese : As I said to you, we have had discussions with Japan on that as well. I am more than happy to take you through the language in the trilateral communique and indicate to you why it does not represent—

Senator DASTYARI: I am conscious of time and only have one question.

Senator Brandis: Let Mr Varghese finish his answer.

Mr Varghese : It does not represent a new articulation of the Australian position.

Senator DASTYARI: So your point is that the Chinese are wrong when they say it is. That is fine if that is our position.

Mr Varghese : I can only speak myself.

Senator DASTYARI: But their interpretation is wrong?

Mr Varghese : If China's interpretation is that we were taking sides, which I think is what the Chinese were arguing, in a territorial dispute, that is not what this communique says and it is not what the position of the Australian government is.

Senator DASTYARI: But signing a communique with one of the partners or one of the countries involved in the territorial dispute—

Mr Varghese : Where in this communique does it say that Australia supports Japan's claim in the East China Sea?

Senator DASTYARI: Mr Varghese. I keep going back to these two points. Firstly, when the East China Sea issue is an issue of concern, talk of 'unilateral action' in a communique which was prepared with the Japanese and American governments, I think it is a significant event and it has precipitated a series of events that have resulted in a rebuke—

Senator Brandis: Senator Dastyari, you were invited by the secretary to point to language in the communique—

Senator DASTYARI: I am asking a question, which I am entitled to do.

Senator Brandis: But the interpretation you asserted—

Senator FAULKNER: It was a little out of order, don't you think, Mr Varghese, to be asking Senator Dastyari—

Senator DASTYARI: Mr Varghese saw fit to ask me a question, I feel the need to ask him questions.

CHAIR: If you don't mind, Senator Dastyari, the minister is making a point.

Senator Brandis: My point, through you, Mr Chairman, is that Senator Dastyari in various formulations has asserted to the secretary a proposition which the secretary does not accept and in fact disputes. The secretary has asked the senator to identify in the communique, which is the subject of his questions, the language that supports his assertions, and he is unable to do so. There is no such language there.

Senator DASTYARI: Not at all, Senator Brandis. I think I have made my point quite clearly. I will rephrase it in one final question. We are all diplomats here.

Senator FAULKNER: There are some exceptions.

Senator DASTYARI: My concern is that a statement that was prepared as a communique—and we do not know who in your department was involved with it, though no-one at the senior level seems to have been involved in it—precipitated a series of events, which, I believe, has affected our relationship with our largest trading partner and has resulted in a situation which the First Assistant Secretary for the North East Asia Division has described as the largest humiliation—

Senator Brandis: That is not what he said. Senator Dastyari. Though you, Mr Chairman, you surely understand that in diplomacy language is very important and you should, if I may say so, take particular care in characterising and, in this instance, misstating what an officer has said at the table this morning. He did not use the word 'humiliate'.

Senator DASTYARI: Do you remember the word that was used, Senator Brandis?

Senator Brandis: Senator Dastyari, I am not going to formulate your questions for you, but you ought to be a little more—with respect, I know you are a new senator—responsible in this particular field.

Senator DASTYARI: This is a serious matter we are talking about.

Senator Brandis: Yes, it is. It is very serious.

Senator DASTYARI: The relationship with our largest trading partner—

Senator Brandis: So, please do not misstate the evidence of a witness.

Senator DASTYARI: The actions of your government are putting that at risk.

Senator Brandis: That was not the evidence from Mr Varghese, that was not the evidence of Mr Rowe and it does not help matters if you then misstate the language that Mr Rowe used earlier.

Senator DASTYARI: I must say at times Mr Varghese and Mr Rowe do not seem to be on the same page. May I ask my question, Chair?

CHAIR: Proceed to ask your question.

Senator DASTYARI: Mr Varghese, and I do not believe I will get an answer, but I will ask you anyway—

CHAIR: Just ask the question.

Senator DASTYARI: How are you able to categorise the current foreign policy relationship between Australia and China as strong, when the series of events as outlined has put that relationship at risk?

Mr Varghese : I do not have the view that when you disagree with a country that you are putting the relationship at risk. I do not believe China has that view at all. Just recently I met with a very senior official from the Chinese foreign ministry. We had a good discussion about the bilateral relationship and, I would have to say, the tone of that discussion and the substance of it was extremely positive. This is not the discussion you have with a relationship at risk. I just cannot accept your description.

Senator DASTYARI: With the chair's permission, I will table the story in the Xinhua News on 7 December. Is that okay?

CHAIR: Yes. What is the Xinhua News?

Senator DASTYARI: It is a Chinese paper.

Senator FAULKNER: Is it in English?

Senator DASTYARI: It is in English. There is a copy of it, I think, already—

Senator FAULKNER: I will not be able to read it if it is not in English.

Senator Brandis: Is this an English-language newspaper, by the way, or a Chinese-language newspaper?

Senator FAULKNER: That is the question I just asked as an aside to my colleague.

Senator DASTYARI: My understanding is that it is both.

Senator FAULKNER: I do not know the answer, but this article—

Mr Rowe : It is the official Chinese newsagency which reports in Chinese and English and various other languages. This is its English-language news service.

Senator DASTYARI: I am just tabling it because we have made reference to it.

Senator FAULKNER: We can certainly confirm that the document that has been tabled is not only in English; it also has pictures.

CHAIR: That is very helpful, Senator.

Senator Brandis: It actually has one picture.

Senator FAULKNER: That is not true if you look at the second page.

Senator Brandis: No, that is not right, Senator. The eight pictures on the second page do not belong to the article.

Senator FAULKNER: I knew you would go to the pictures first!

CHAIR: Senator Brandis is very meticulous.

Senator Brandis: I just have a hatred of inaccuracy.

CHAIR: That was only to be expected. We will go to Senator Fawcett.

Senator FAWCETT: In light of some fairly alarmist reporting in the papers recently about Chinese naval ships transiting the waters to our north, could you outline for the committee DFAT's understanding of our relationship with China in terms of our growing military cooperation and ties, trade and relations? Could you give a snapshot of where you see the relationships developing in those areas? Is there any truth in the alarmist tone of some of those articles?

Mr Varghese : As I indicated to Senator Dastyari, I think our relationship with China is broad-ranging and comprehensive. It was described as a strategic partnership during the last prime ministerial visit to China. It has a very substantial economic base, but it also has a very substantial people-to-people connection. China has consistently been amongst the top three sources of skilled migrants to Australia. China is by far our largest source of foreign students. We have a political dialogue which is growing in depth. We have a defence and military cooperation which is also significant. We have had a high-level defence dialogue with China, at secretary of Defence and CDF level, that has run for 15 or 16 years, or perhaps even longer. This is in all respects a comprehensive relationship. That does not mean that we agree on everything. There are areas where we have differences of view, but we manage those, I think, in a sensible and careful way.

Senator RHIANNON: Has our ambassador to China spoken to Chinese officials about the trend of self-immolation amongst some Tibetans?

Mr Varghese : The issue of human rights in Tibet is the subject of conversations with China at several levels. It has indeed been raised by our ambassador in Beijing. Our ambassador in Beijing visited Tibet, and most recently it was one of the topics that was included in the Australia-China human rights dialogue, which was held in Beijing.

Senator RHIANNON: Just to ask the question again—I appreciate that there is discussion about human rights—has the current trend of self-immolation among Tibetans been discussed?

Mr Varghese : Yes, it has.

Senator RHIANNON: You said that our ambassador has visited Tibet. Has she visited without Chinese officials accompanying her?

Mr Varghese : I would have to take advice on that. My understanding of those sorts of official visits by ambassadors is that it usually does involve accompanying Chinese officials.

Mr Rowe : It would require them to approve travel to Tibet. I think that these days she would not have a minder, as such, but she would be talking to officials. She would presumably have to hire a car and driver while she was there—who would probably be official.

Senator RHIANNON: I would like to clarify that. There could be some variance with what Mr Varghese said. Mr Varghese, I think you said that you assumed she would, but then—

Mr Varghese : I am always happy to be corrected.

Senator RHIANNON: Do you need to take it on notice?

Mr Varghese : No, I am very happy to go with what Mr Rowe has said.

Senator RHIANNON: Mr Rowe, has she visited there with no officials? Has she gone there with nobody, at whatever level—be it a Chinese driver or a Chinese government official—from any section of the Chinese government, or possibly associated with the government, accompanying her?

Mr Rowe : Do you mean accompanying her all the time?

Senator RHIANNON: Yes.

Mr Rowe : I assume it would be the same as any visit to any province. She would go there, taking the plane by herself—apart from other embassy officials. When she arrives, she may well be met by a car and driver or a protocol official. They would take her to the hotel, where she would be left by herself. She would take the car and driver to other official and unofficial appointments.

Senator RHIANNON: Is she free to meet people in Tibet with no Chinese officials or Chinese at any level of employment?

Mr Rowe : I do not know. I would have to take that on notice.

Senator FAWCETT: Mr Varghese, in February this year, the ambassador from China here in Canberra made the following remarks. He said:

We are happy to see China-Australia relations have grown from strength to strength since 1972. The friendship between our two peoples has been deepened. And our wide-ranging cooperation is growing and promising. Working together, we can secure a better future and the well-being of our people. Bearing that in mind, we need to make the pie of our cooperation bigger and our stronger strategic partnership stronger.

Is it your opinion that that reflects the Chinese view of our relationship—as stated by their ambassador?

Mr Varghese : It does, yes.

Senator RHIANNON: Mr Varghese, can you update the committee on what interactions the embassy or our representatives in Mongolia have had with Rio Tinto—or what assistance they have provided Rio Tinto—with regard to their mining plans in that country?

Mr Varghese : I will see if anyone has more details, but Rio Tinto is a large Australian company. We do not have an embassy in Mongolia. We have an Austrade office. I would imagine that the Austrade office in Mongolia would have a great deal to do with one of Australia's largest miners who are engaged in a project which, I think, represents a very substantial proportion of Mongolia's GDP.

Senator RHIANNON: Are you happy to take it on notice?

Mr Varghese : I do not need to take it on notice.

Senator RHIANNON: I was asking for details.

Mr Varghese : They probably deal with Rio Tinto on a very regular basis.

Senator RHIANNON: At the moment you are just saying 'probably'. I was actually asking for details.

Mr Varghese : Are you asking me to find out every time our Austrade officers had contact with Rio Tinto?

Senator RHIANNON: You know I am not doing that, Mr Varghese. All I am asking is for some real details rather than just saying: 'They are a big company, so probably it happens.'

Senator Brandis : I think Mr Varghese is entitled to know what it is that you are asking. To simply say: 'I would like the details' is terribly vague. If Mr Varghese can answer you, he will; if he cannot, we will take the question on notice. But he needs to know what you are asking.

Senator RHIANNON: What I was asking was: what interactions and what assistance do Australian embassy officials, who represent our interests in Ulan Bator, Mongolia, have with and provide to Rio Tinto?

Mr Varghese : I am happy to take your question on notice.

Senator RHIANNON: Thank you. I was referring to interactions and support.

Mr Varghese : If they have a daily conversation, I am not going to our ask Austrade officers to provide us with—

Senator RHIANNON: It is not about daily conversations. They have got business interests there. How are you facilitating their business interests? It is a pretty basic question and does not need to be avoided.

Mr Varghese : I was not avoiding it.

Proceedings suspended from 12:31 to 13:36

CHAIR: We were down to North Asia, which includes China, of course, but Korea as well. I would just like to ask a question or so about our relationship with Korea. We have quite a strong trading relationship with Korea—they buy a lot of iron ore and things like that from us—but we do not seem to have a very broad relationship with Korea. I know we have recently signed a free trade agreement with them, but what other dimensions are there in our relationship with Korea—South Korea, of course?

Mr Varghese : It is a very substantial relationship. While I think the public perception of it is often dominated by the economic relationship, the reality is that we do a lot with Korea on a number of fronts. We are countries that see the broader regional strategic environment in broadly similar terms. We are both, of course, allies of the United States. We work very closely together in regional institutions, particularly in the East Asia Summit. We are both countries which pursue middle power diplomacy, if you like, but do so from the perspective of a democracy with a commitment to open markets. I think that creates a connecting thread between our two countries. Now, of course, we also have the so-called MIKTA group, which brings together a number of like-minded middle powers, including Korea. So, if you take all of that together with the recent conclusion of the FTA and, of course, also a connection through Korean students studying in Australia, I think it is reflective of the fact that our relationship with Korea is one of our most important in the Asian region.

CHAIR: Can you give me an idea of how many students there are studying in Australia from Korea?

Mr Rowe : In 2013 there were 27,580. That is the figure we have. That makes it the third largest source.

CHAIR: Yes, that is a large number. That is quite interesting, and it is much more than from Indonesia, I think. Is that not the case?

Mr Rowe : I do not know the Indonesian figure, but they are the third largest.

CHAIR: Indonesia is about 18,000 or something. I am a little bit surprised by that, but that is very good. In what areas do you think there is scope for expansion of our relationship to things like tourism and student exchanges? Would you like to comment on the potential?

Mr Varghese : I think the economic relationship still has a lot of room for growth, and the FTA will actually be a very important facilitator of that. I think room for doing more together multilaterally is also quite significant. They have been a very good partner of ours in the G20, Korea, and that continues to be the case. We work very well with them also in the United Nations, so there is quite a lot of like-mindedness between the two countries.

CHAIR: Do we offer tertiary scholarships to Korean students?

Mr Varghese : They would not qualify for scholarships under our aid program, because obviously they have graduated from all of that. They would be a country that we would look at for the next phase of the New Colombo Plan, but that is next year.

CHAIR: They are obviously, as you say, a good ally in the region. We will move to South-East Asia now and I might ask you about the ASEAN group in a moment.

Senator MILNE: I just wanted to ask some questions with regard to Cambodia in particular. Does the department share concerns about the human rights conditions in Cambodia, as outlined by Amnesty International and corroborated by other leading NGOs and governments, including the US?

Mr Varghese : I will ask Mr Cox to add if he wants to, but we do have some concerns about the human rights situation in Cambodia. We have raised those not only in the appropriate multilateral forums, but also directly with the Cambodian government, including during Foreign Minister Bishop's most recent visit there last weekend.

Senator MILNE: Could you outline to me which of the human rights concerns you raised or have?

Mr Cox : At the recent UN Universal Periodic Review, Australia made a statement on human rights at that time, and that was reiterated by Minister Bishop during her meetings in Cambodia last week—so she reiterated the key points of that statement at Geneva.

Senator MILNE: What were the key points? What is the main concern Australia has?

Mr Cox : We were concerned about the violence on 2 and 3 January, when violence broke out against garment workers and other protestors in Phnom Penh. We have been concerned about the general situation of some of the protestors and over the situation of the political stand-off in Cambodia, but the minister was also able to welcome the 18 February agreement between the government and the opposition to work on electoral reform processes going forward. We did reiterate our concern about the human rights situation, but also encouraged the government and the opposition to work on compromises on the electoral reform agenda.

Senator MILNE: On the electoral reform agenda in particular, you would be aware that Opposition Leader Sam Rainsy and others have been calling on the international community, including Australia, to condemned the electoral irregularities that occurred at the election, and the only reason the opposition agreed to that proposed deal with Hun Sen was that they looked at the irregularities. I understand that has not happened. Did the department advise the minister or Prime Minister to raise concern internationally about the irregularities in the election in Cambodia?

Mr Varghese : We do not go to the content of our advice to the minister.

Senator MILNE: So I will ask the minister. Did the government consider making some public statement about the irregularities in the vote in Cambodia, given that the opposition there was calling for it and given Australia's role previously in Cambodia?

Senator Brandis: I will take that on notice.

Senator MILNE: Given what you have just said about violence, about the situation and the crackdown on the protesters and about the impending likelihood of a further national strike in Cambodia, can you tell me whether the department has provided advice to the minister in relation to sending asylum seekers that have arrived in Australia to Cambodia?

Senator Brandis: I think that goes to the content of advice to the government.

Senator MILNE: I asked whether the department has provided advice.

Senator Brandis: Yes, but then you went on to describe with particularity in a way that, were the question to be responded to, might reveal the content of any advice which may or may not have been provided.

Senator MILNE: Let me ask another question. Did the minister ask in Cambodia for the Cambodians to take asylum seekers from Australia?

Senator Brandis: I will take that on notice.

Senator MILNE: Can you confirm that reports have been made in the press that Hun Sen would give serious consideration to the request. Are you able to confirm that any request was made in relation to asylum seekers by the minister?

Senator Brandis: I think that is really the same question as you asked a moment ago, so I will take that on notice.

Senator MILNE: Perhaps, then, you would take on notice whether there was any conditionality put by the minister to the Cambodian government about Australian aid and taking of asylum seekers.

Senator Brandis: These questions about whether an issue was raised with the Cambodian minister by Ms Bishop are all questions that I will take on notice?

Senator MILNE: In terms of international action, apart from what you have just outlined in terms of the United Nations processes, is there any other action that the Australian government has taken with regard to election irregularities in Cambodia? Have we raised it in any other forum apart from the discussion you have just referred to from the minister with the government there on her recent visit?

Mr Cox : The Australian ambassador in Phnom Penh is in regular contact with the government in Phnom Penh about a range of issues and has raised concerns about the situation on the ground there in different dialogues with the Ministry of Foreign Affairs and International Cooperation and with other agencies of the Cambodian government and is monitoring these situations very closely. We do that through our embassy in Phnom Penh.

Senator MILNE: Has Australia registered any concern about the election irregularities in Cambodia through other United Nations processes?

Mr Cox : As I said, during the UN Human Rights Council's universal periodic review on 28 January we did just that. That is the appropriate vehicle through which to do that.

Senator MILNE: Is that the only vehicle through which we have done it?

Mr Cox : Yes. That is the most appropriate vehicle through which to do it.

Senator MILNE: Thank you.

Senator FAWCETT: This month marked the 40th anniversary of the dialogue between Australia and ASEAN, and I believe there was a dialogue this month. Can you talk about the current state of our relationship with ASEAN? Have there been any significant developments?

Mr Varghese : As you would appreciate, the relationship with ASEAN as a group and our relationship with each individual ASEAN country is a very important part of our overall foreign policy. We do indeed celebrate 40 years. I think we were the first dialogue partner that ASEAN had. I think the whole ASEAN story, the development and the cohesion of ASEAN in the post-war period not only is remarkable but has contributed in large measure to stability in South-East Asia, which is always a primary consideration for Australia.

We now have a relationship with ASEAN which I think is genuinely comprehensive. The economic relationship is in good repair and added to by the existence of the ASEAN-Australian-New Zealand Free Trade Agreement. We have sent our first resident Ambassador to ASEAN in Jakarta, which is a signal I think of the commitment we have to the organisation. I wish to further develop the relationship. And of course we work with ASEAN very closely in regional institutions such as the East Asia Summit in APEC, in the ASEAN regional forum. We think the growing political cohesion of ASEAN is, on the whole, a very positive development and I think it is very much in our interests to ensure that we maintain a strong and forward-looking relationship with them.

Senator FAWCETT: In terms of practical co-operation and developments in the area of emergency management, disaster relief and humanitarian relief, what recent developments have there been in those areas and where do you see those taking our engagement with the region?

Mr Varghese : I do not know whether Mr Cox would like to go into that.

Mr Cox : We have very active engagement with ASEAN's and the countries of ASEAN's disaster management organisations through Emergency Management Australia. We have an active program of exercises, activities, desktop exercises and planning activities with them. We also seek to raise the profile of this work through various political declarations from time to time at different ASEAN and East Asia summits on disaster management and the role of ASEAN in Australia and other partners in disaster management. So that is a very active area of policy work with ASEAN, given the prevalence of natural disasters in a number of ASEAN countries.

Senator FAWCETT: Has there been any movement or work towards a standing capability for responding to natural disasters in a collaborative effort between the nations? Or is it purely a contribution as available on an occasion-by-occasion basis?

Mr Cox : I think it is both with the countries of ASEAN and with the organisation. I think we now have two personnel with the ASEAN secretariat in Jakarta who are helping them with disaster management response and planning. We are contributing both regionally to help coordination and individually assisting different countries bilaterally. I think we are very much engaged in helping boost the capacity of ASEAN as an organisation. Last week, at the launch of our 40th anniversary celebrations in Manila, the Secretary-General of ASEAN, Le Luong Minh, said to me that they are very happy about the role of these disaster experts that we have placed in the secretariat, helping them with coordination, capacity building, preparation and implementation of emergency relief.

Senator FAWCETT: That is a very good segue to my next question which, in fact, is about the Philippines-Australian ministerial meeting that I believe occurred this month. Can you tell me about the key outcomes, or programs, that are developing from that relationship?

Mr Cox : The Philippines-Australia relationship is one that is of growing strength and importance. Both Minister Robb and Minister Bishop held talks with their counterparts on a range of areas. There was, I think, strong recognition of the value of Australian assistance for Typhoon Haiyan, which was very much welcomed by the Philippines side. The Australian government has provided in direct ODA $40 million worth of assistance plus some extra assistance as well through our education programs and other programs as well as the defence contribution, which by some estimation is valued at about $30 million. The Philippines government was very grateful for that assistance.

During the visit the Ms Bishop was able to announce a major new six-year $150 million education program, which will assist both the typhoon affected areas as well as the rest of the Philippines. There was also extensive discussion about the potential for new trade and investment, including investment in infrastructure, with the government providing further support for a PPP policy centre. There was a signalling of real potential for upgrading the economic relationship and intensifying the relationship across people-to-people, defence and the whole gamut of relations. So I think it was a very positive meeting.

Senator FAWCETT: I understand the foreign minister met with the Malaysian foreign minister this month. I know his public statement said that he felt the state of relationship between Malaysia and Australia was in excellent condition. Can you talk about the outcomes of that meeting and the significance of our relationship with Malaysia?

Mr Cox : The minister did indeed have a long meeting with her counterpart, Minister Anifah, in Kuala Lumpur. Indeed, the relationship with Malaysia is in very strong order. We have strong trade and investment relations with Malaysia. We have a strong longstanding defence and security partnership. We have large numbers of students from Malaysia in Australia as well as three significant campuses of Australian universities in Malaysia.

The relationship politically is in very strong order as well. Just recently Minister Morrison was visiting Malaysia and the home affairs minister of Malaysia also visited here last week. So we have very intensive and very active relations with Malaysia.

Senator FAWCETT: Was there any discussion about changing the scale of the defence relationship in terms of visiting forces?

Mr Cox : The scale?

Senator FAWCETT: In terms of the size and number of units and frequency of their visits.

Mr Cox : I think there is a general belief that the relationship should continue on its current trajectory. It is very intense. As you know, we have a rotational basing at RMAF Butterworth. That is continuing. We have very active cooperation through the Five Power Defence Arrangements as well as bilaterally. I think the outlook is that those sorts of links will continue.

Senator FAWCETT: Have there been any amendments to the Status of Forces Agreement with our forces in Malaysia?

Mr Cox : I do not believe we have a Status of Forces Agreement with Malaysia in that sort of term. I perhaps need to take that on notice or you would need to ask the Department of Defence. Certainly we do have arrangements to facilitate our rotational presence at places like RMAF Butterworth. I will take that on notice and get you more details about the legal foundations of our basing arrangements there.

Senator FAWCETT: That would be good.

Senator DASTYARI: Minister, if it is okay, I want to ask you some questions regarding the code of conduct arrangements between us and Indonesia that have been discussed a bit. I am just not quite sure where that fits into the foreign affairs space or the intelligence space. I imagine there is naturally a bit of overlap between the two.

Senator Brandis: Well, you ask a question, Senator Dastyari, and I will do what I can.

Senator DASTYARI: I want to get effectively a status update. Obviously there has been some media discussion and speculation—I think there have even been statements to that effect—that there is going to be a preparation of a code of conduct to deal with the fallout from recent media reports. I am picking my language quite carefully here. I was just wondering if you were able to provide a status update on where that is at.

Senator Brandis: Mr Varghese is able to respond to that question.

Senator DASTYARI: I was not sure whether that was a A-G's matter or a Foreign Affairs matter.

Senator Brandis: No, it is a Foreign Affairs matter, and Mr Varghese will tell you, subject to the usual caveats about intelligence matters, what he feels he can say.

Mr Varghese : As you may recall in the wake of the Snowden allegations, it was agreed between our two governments that we would begin work on a protocol, or a code, which would cover, amongst other things, the intelligence relationship. The foreign minister visited Jakarta in December—

Senator DASTYARI: Is that the visit that Mr Shearer was on?

Mr Varghese : Yes, it is.

Senator DASTYARI: So that is the one on 4 to 9 December?

Mr Varghese : Well, I think the discussions were on 5 December, so, yes, it would cover that period.

Senator DASTYARI: Just on that, this goes back to a question that we have actually already asked on this matter, and I just want to bring it to your attention because—don't not get me wrong, I am not implying there is something improper here in any way, shape or form—when we asked at the last budget estimates process to provide us a list of the overseas travel that had been performed by the minister and who accompanied her from ministerial offices on that visit, Mr Shearer's name was left off this trip. Other staffers—

Mr Varghese : I was not here for the last estimates hearing and I have not—

Senator DASTYARI: It was taken on notice.

Mr Varghese : I do not know the particular document you are referring to, but I assume that in our response we would have covered who from the foreign minister's office had accompanied the minister.

Senator DASTYARI: Sure, but that was not the question.

Mr Cox : The estimates hearing was held before 5 December.

Senator DASTYARI: No, sure. But the statement you have got here, the dates here, you say senior adviser Robert Ferguson—who I am not familiar with but is obviously staffer of the minister—was on the trip. In other places, other staffers that were on the trip were stated as being on the trip, but Mr Shearer's name does not appear as being on the trip.

Mr Varghese : But I think that was because we were only giving information in relation to our minister and our minister's office and departmental officials.

Senator DASTYARI: But that was not the question that we asked. We will move on, because I think it was an oversight. Frankly, it is not that big a deal, so I am not implying that there was anything improper. I am just bringing it to your attention. So, yes, that was the visit that Mr Shearer went on?

Mr Varghese : It was.

Senator DASTYARI: And for the obvious reason that they were discussing the code of conduct. Again, I am not implying anything improper; it was a national security matter.

Mr Varghese : It was a discussion that covered a range of issues, and I accompanied the minister, and the Secretary of the Department of Defence also accompanied the foreign minister on that visit.

Senator DASTYARI: You went to the Indonesia part but you did not go to the China part of the trip? Mr Rowe went to the China part of the trip?

Mr Varghese : That is correct.

Senator DASTYARI: And there was a Philippines part of the trip as well, which obviously you were not attending.

Mr Varghese : No, I did not attend.

Senator DASTYARI: So, going back to this issue of the code of conduct, there obviously have been meetings that have been held between us and the Indonesian government, understandably. It is fair to say that DFAT is helping play a role in preparing the code of conduct. You are obviously travelling with the minister, so that is a role you are playing?

Mr Varghese : Well, the foreign minister has the lead on these negotiations—

Senator DASTYARI: Of course.

Mr Varghese : so obviously the department is very closely involved, and, as you would expect, we work closely with other agencies as we do that.

Senator DASTYARI: Is it fair to say that this is a priority for the government?

Mr Varghese : It is an element in the relationship with Indonesia. The relationship with Indonesia is clearly a priority for the government.

Senator DASTYARI: As it would be for any government.

Mr Varghese : For any Australian government.

Senator DASTYARI: Again, I am just trying to get my head around this. Is this process we are going through the single biggest issue with Indonesia at the moment? We are talking about what is happening at a DFAT level and our interaction with Indonesia. This is obviously the big things at the moment, isn't it?

Mr Varghese : I certainly would not characterise it as the single biggest issue in the relationship with Indonesia. The thing about the relationship with Indonesia is that it is a genuinely broad-based relationship. The last time we did an audit of the relationship, which was not all that long ago, we were able to identify 60 distinct areas of bilateral cooperation with Indonesia. For the most part, all of those areas are going forward. Some of them have been the subject of some restrictions, but they were a very small number.

Senator DASTYARI: I am choosing my words carefully here, but these matters that you read about—they have been in the papers and in the public domain—obviously put strain on a relationship. Part of the code of conduct process was to try and kind of alleviate some of that. Is that a fair assessment?

Mr Varghese : The idea of a code or a protocol came from the Indonesian side. It was one that we were happy to work with. We are doing so. The foreign minister visited in December. There was a very good discussion with Foreign Minister Natalegawa. At the conclusion of that visit, we foreshadowed that we were happy to provide a draft of what a protocol or a code might look like.

Senator DASTYARI: So the draft has been provided to the Indonesians?

Mr Varghese : We have done that. We are now awaiting a response from Indonesia.

Senator DASTYARI: On that, you said you had a successful meeting. I just want to put a quote to you from the Indonesian foreign minister. I have pronounced his name wrong many times before and I will do it again—so I apologise. You obviously know him well. Marty Natalegawa—I know I am pronouncing it wrong; I have done that to his face as well—said:

Until five months ago the Indonesia-Australia relationship was very close, very positive, a strategic relationship. I myself used to manage it, and knew that the relationship between Indonesia and Australia was very good - maybe the closest that we have ever been. And in an instant, just overnight, that relationship changed.

The question I want to put to you is how are we planning to repair that relationship? Is the code of conduct the path to doing that?

Mr Varghese : The protocol will have a role to play in dealing with the issues that we are currently working through with Indonesia. I have said to you that I think this is not just a broadly-based relationship, but it is moving ahead in most of those 60 areas. There are challenges in the relationship. You do not need to be privy to deep diplomatic secrets to appreciate that.

Senator DASTYARI: You just need to read The Jakarta Post.

Mr Varghese : As we work through those challenges, and for our part we are very committed to working through those challenges—

Senator DASTYARI: What are the challenges? Can you run through what the challenges are? You talked about the challenges. Can you run through them with me?

Mr Varghese : One of the issues we will have to deal with is how we handle the Indonesia idea for a protocol that covers cooperation in areas such as intelligence.

Senator DASTYARI: And maritime issues?

Mr Varghese : I do not think that the protocol itself would go to maritime cooperation issues.

Senator DASTYARI: So the protocol is solely specific on the intelligence and spying-related media speculations, is that fair?

Mr Varghese : Intelligence will be an important component of the protocol, but it will be located within the broader political and security relationship that we have with Indonesia.

Senator DASTYARI: Is the protocol about the broader security relationship or is the protocol specific about the intelligence and spying allegations?

Mr Varghese : It is both. The protocol will not deal with the so-called Snowden allegations. The protocol is about how we engage with each other in areas such as intelligence but also other areas of the security relationship. For our part, we will approach the protocol in terms of some of the principles that the Prime Minister and others have enunciated about the purposes of Australian intelligence.

Senator DASTYARI: Is what you are saying that there were meetings in Jakarta to this effect late last year and that a proposal was presented by the Australian government, which DFAT played a role in formulating, and that we are waiting on a formal response from the Indonesian government?

Mr Varghese : That is correct.

CHAIR: I might just add a comment. I am a member of the Australia Indonesia Business Council. I was in Jakarta in January and at least the business people there feel that our relationship has got a great future and that the current political problems will be overcome.

Senator SIEWERT: I want to ask some questions about the Montara oil spill and its impact on East Nusa Tenggara. I understand that Senator Whish-Wilson asked a couple of questions at last estimates and the responses to those questions were that there had not been any work done. I just want to follow up on that. Since the last estimates, have there been any discussions or any correspondence from the department with the government of Indonesia around the oil spill and its impact on the Indonesian waters?

Mr Varghese : I do not know the answer to that question. I will just check whether Mr Cox or anyone else in the room may be able to help you with that.

Mr Cox : I am not aware whether any further work has been done with the Indonesian government on the Montara oil spill.

Mr Varghese : We are happy to take that on notice in case there is anything to report.

Senator SIEWERT: If you could take it on notice, that would be great. In the past, was there any discussion with the Indonesian government about the oil spill, its impact on Indonesian waters and any particular interaction over East Nusa Tenggara, given the concerns that the local fishers have and the local seaweed farmers have?

Mr Cox : In the past there certainly have been discussions involving our embassy officials and local officials about the impacts, but not recently, no.

Senator SIEWERT: What were the outcomes of those discussions? Did anybody go and look at the concerns that the fishers and the seaweed farmers had?

Mr Cox : I will have to take that on notice. I do not think that my notes cover those historical circumstances. But we can get you more historical detail on that.

Senator SIEWERT: If you could, that would be appreciated, particularly as to whether anyone visited and talked to farmers and fishers, and undertook any evaluation of their concerns.

Mr Cox : Yes.

Senator SIEWERT: And also whether there had been any contact with the provincial governments in the region?

Mr Cox : The Australian embassy is quite often in contact with provincial governments, such as the provincial government of Nusa Tenggara Timor. That would have happened. In terms of the detail of those historical discussions, I will get you more details on notice.

Senator SIEWERT: I appreciate that you would have been in discussions with provincial governments, but I meant particularly about this issue. That would be appreciated.

Mr Cox : Yes, of course.

Senator SIEWERT: Further, was any work done on the projections of the oil spill and the dispersant? There was some discussion in the past around the impact of the oil and the waxy substance that was produced, but was there any tracking of the mousse that was also produced when the oil and the dispersant mixed? Was any work done there with the government?

Mr Cox : Yes, some work was certainly done by PTTP—the Thai oil company that was involved in that spill. So, again, we will get you the details of that on notice.

Senator SIEWERT: That would be fantastic—and any economic analysis that was done on the impact on fishers and the seaweed farmers. I was up there myself last week, talking to the seaweed farmers and the fishers. I would also like to know what the most recent contact was around that ongoing economic impact that the local fishers and seaweed farmers are concerned about.

Mr Cox : Yes, we will get you that. There has been quite extensive work done by the company and by other players on this set of issues, so we will get you some further detail on that.

Senator SIEWERT: Okay. Would you be the department that is liaising with the company over this particular issue now?

Mr Cox : In the past we have had discussions with PTTP or its representatives, who have sometimes come to brief us. But now the issue has been brought more or less to a resolution we have not had much contact with them in recent times—certainly not in Canberra.

Senator SIEWERT: With all due respect, Mr Cox, I would not say that the local fishers and the seaweed farmers think that the issue has been brought to a resolution. There was a forum in Kupang last week that I was at, and I can tell you that they don't think it has been resolved. If you could provide on notice the most recent times that you have had discussions with the company; whether there has been any thought given to requiring the company to undertake the comprehensive study that the local community has been repeatedly asking for; and when there last were any negotiations or discussions held with the Indonesian government and the company about those particular issues.

Mr Cox : Yes, we will take all of that on notice.

Senator SIEWERT: Much appreciated, thank you.

Senator FAWCETT: I have a question on Burma. Is it correct that a decision was made by the government last year that DFAT would revert from the use of the name 'Myanmar' to the name 'Burma'?

Mr Cox : With respect to the nomenclature, we use the term 'Myanmar' when referring to the Myanmar government but we use the term 'Burma' in certain other circumstances.

Senator STEPHENS: What circumstances?

Mr Cox : Perhaps in a domestic context, where people understand the term more readily. This term can be used in different circumstances according to the different contexts in which the word can be used and understood.

Senator FAWCETT: For example, on your website, in describing the country we know as 'Burma', was that instruction taken by DFAT as being a directive to change your website to reflect the country to be known as 'Burma'?

Mr Cox : I think in the domestic Australian context the term 'Burma' is widely understood as the term for that country—

Senator FAWCETT: That's not my question.

Mr Cox : so on the website we have used the term 'Burma'.

Senator FAWCETT: My question was: did you take it as a direction to use that?

Mr Cox : We have used the term 'Burma' on the website because it is the widely understood use of the term for that country.

Senator FAWCETT: How long did it take DFAT to make those changes?

Mr Cox : Rolling changes to websites take a while—they have taken a few months, as we have worked through the website, alongside other priorities.

Senator FAWCETT: And you think that is an acceptable time frame?

Mr Cox : Yes, I think so.

Senator FAWCETT: Was there any resistance within the department to that change?

Mr Cox : No, none at all.

Senator FAWCETT: Okay.

Senator STEPHENS: On that point, perhaps you can enlighten the committee about why there are two names, why the country called 'Myanmar' calls itself 'Myanmar' and we call it 'Burma'. I know that there is an historical context.

Mr Cox : I think it is historical. I think there are issues relating to the history of the adoption of the term 'Myanmar' by the military government at that time: the fact that Aung San Suu Kyi, as the leader of the opposition, had signalled at an earlier stage that she did not necessarily accept the use of that term and that it was a term used by a government that was not elected democratically. As a result of these historical facts, the two terms have arisen in international parlance. There are different views about whether or not one name is right within the ASEAN context. The ASEAN countries seem to use the term 'Myanmar' internationally and they recognise that term, but in other countries the term 'Burma' is recognised. I think it is recognised that the two terms tend to coexist alongside each other but the government of Myanmar itself, the current government which has now moved beyond the former authoritarian military regime, still uses the term 'Myanmar.' They refer to the government as the government of Myanmar; therefore, that term is used by them. We recognise that these terms coexist. There are debates about it, but that is the way it is.

Senator STEPHENS: Mr Varghese, does this happen in any other countries?

Mr Varghese : It is not common but nor is it unique. East Timor is a good example. The name of East Timor is Timor-Leste. In Australia I think more people would recognise the descriptor 'East Timor than they would 'Timor-Leste.' When we deal officially with the government of Timor-Leste we address it as the government of Timor-Leste, but I certainly talk a lot about East Timor as a country. I do not think it is a common thing but nor is it completely unique.

Senator STEPHENS: It is quite intriguing.

Senator Brandis: Usages change over time. We used to call Sri Lanka 'Ceylon' and before that it was called 'Serendib.'

Senator STEPHENS: Yes, that is right. That was a long time ago.

Mr Varghese : Cambodia went from Cambodia to Kampuchea and back to Cambodia.

Senator STEPHENS: Thank you. I was just interested. I noticed that the change had occurred on the website too and I was trying to figure out whether there was a diplomatic issue around the terminology.

Mr Cox : It is an issue of usage and common understanding of usage.

Senator FAWCETT: Can you confirm for us the current state of the live cattle export with Indonesia? There was a lot of angst when Australia unilaterally cancelled that trade. Has that relationship restored? Certainly the trade figures would indicate that we have restored the volume of trade.

Mr Varghese : My understanding of it is that we have rebuilt the live cattle and beef export trade with Indonesia and it is now running at as higher level as it has ever run. I think 700,000 head.

Senator FAWCETT: The point of my question is that the decision to then impose quotas and downgrade the relationship was a political decision in response to the then Australian government's decision. Decisions to reopen that trade are indicative of a political will to re-engage constructively with Australia. I am interested in your comments on the state of the live cattle trade and the implications therefore for the political relationship.

Mr Cox : The quotas have now been lifted. They were lifted late last year and, for example, in this quarter we are expecting that around 170,000 head of cattle will be imported into Indonesia from Australia. The number of cattle that have been going into Indonesia has been expanding significantly to meet the demand in that country. So with the quotas lifted, and with the Australian industry able to supply where it can, the trade is now growing strongly again.

Senator FAWCETT: I hear that. The point of my question though is that, compared to the very low point in our relationship when the trade was unilaterally cancelled, from a political perspective would it be your assessment now that the politics of our diplomatic relationship have improved substantially, which is underpinning that restoration of those trade figures?

Mr Cox : Yes, partially. I also think that within Indonesia there has been a recognition that the quota systems were not working, were not delivering the cattle supply needed at the right price and were driving up prices significantly. This happened particularly last year during Eid al-Fitr at the end of Ramadan where prices went very, very high. At that time I think a number of political pressures within the Indonesian system broke down the quota system. The political circumstances are also part of it. Certainly many from within both governments were lobbying hard for the ending of the restricted quota system. I think the Indonesians domestically, listening to the lobbying that was coming to them, decided to do away with the old quota system.

Senator IAN MACDONALD: That was my one question on Indonesia as well. This trade was stopped overnight without warning, certainly without warning to the producers but also without any warning to the Indonesians. Without verballing or embarrassing the then ambassador, I know the Indonesians were, to put it mildly, very annoyed. What was the extent of the damage to our diplomatic relations at that time from this cessation overnight and without warning of a trade which fed a lot of Indonesian people? Can you somehow quantify that and then, following on from Senator Fawcett's question, can you give us an indication of how that is playing out now. I know the Indonesians were mightily offended that this significant part of their food was stopped without warning.

Mr Cox : As you will recall, that happened as a result of a television program that broadcast examples of cruelty to cattle and then actions were taken to stop the trade. Yes, I think it is right to say that at that time elements within the Indonesian government were concerned about the rapid move to cease the trade and they expressed their concern at the fact that it was done without notice. But moves were then taken after that to try to bring it back. I think the situation was manageable, but certainly they were not happy with the move, no.

Senator IAN MACDONALD: You use 'concern' and 'not happy'. Had I been the government of Indonesia and a substantial part of my food supply was cut off without so much as a phone call, I would not have described my response as 'concerned' or 'not happy'.

Mr Cox : Well, they were not happy.

Mr Varghese : I think it is very fair to say that the decision itself and the way in which it was implemented did cause substantial damage to the relationship at the time. It was something that the Indonesians felt very strongly about for precisely the reasons that you indicate. Conversely, I think the fact that we have been able to build the trade back up not only obviously reflects supply and demand at work, because we are dealing with a supply shortage and growing demand but also indicates that, notwithstanding the challenges we are facing in the bilateral relationship in other areas, important parts of this relationship, such as trade, are continuing to develop very positively.

Senator IAN MACDONALD: Again in fine diplomatic speak you indicate what is happening with the boat people, which is a challenge for both governments, but you are indicating that on another front the Indonesians are now happy with the trade aspects of their relationship with us.

Mr Varghese : Yes. We see no damage to the trade relationship—and, indeed, we are seeing the trade relationship grow in a number of areas, and this is one very good example.

Senator IAN MACDONALD: There was a time in our history when there was a lot of trouble with Indonesian fishermen coming into Australian waters. Is that still an issue or has that been resolved? I know at the time a lot of effort was put in by the Australian government, setting up special envoys over there and special people in the villages, to try and address that. Is it still an issue?

Mr Varghese : Mr Cox may want to add to this, but my sense is that it is not anything like the issue that it used to be, and that reflects, I think, a lot of good and hard work put in by both governments to arrive at understandings that particularly acknowledged the role of traditional fishermen but also through quite an effective information campaign in the relevant parts of Indonesia to explain how the new arrangements worked.

Mr Cox : Yes. The secretary is very much right there. The problem is much less of a problem than it was, say, in the nineties. I think, as the secretary says, the work between the Australian government and the Indonesian government to get the message out to fishermen in various parts of the archipelago about where the fishing line is, where the traditional area is and where the maritime or fishing boundary is has reaped very significant dividends.

Senator IAN MACDONALD: I heard with some surprise at estimates in relation to the Director of Public Prosecutions, the DPP, that in the last couple of years he had been de-funded for any prosecution of Indonesian crews involved in people smuggling. I hope I am not verballing the DPP, but that that is my one-sentence take on what we were told. I was just wondering: is that something that was negotiated diplomatically? Can anyone in Foreign Affairs give me a background to that?

Mr Varghese : The budget and prosecutorial decisions of the Director of Public Prosecutions are not something that the Department of Foreign Affairs and Trade would normally get involved in, so I am not sure I can help you much on that.

Senator IAN MACDONALD: All right—and as I said, I do not want to verbal the DPP. The minister might be able to help me as the relevant minister.

Senator Brandis: Yes. In fact, I can help you, Senator Macdonald. The decision of the previous government to not renew the funding to that part of the Director of Public Prosecutions budget that was allocated to the prosecution of people smuggling was not a decision made at the request of or, so far as I can determine, with any involvement of or consultation with the department of foreign affairs; and the same can be said of the decision of the previous Attorney-General, Ms Roxon, not to prosecute certain categories of people smugglers and to issue a direction to the DPP to that effect.

Senator IAN MACDONALD: So it was purely a legal-financial policy or philosophy direction rather than anything to do with—

Senator Brandis: It was a decision made by previous attorneys-general which did not involve consultation with—and where they were not responsive to any request from—those who manage the relationship with Indonesia at a diplomatic level.

Senator IAN MACDONALD: Okay. Can I just ask the officials if that has figured at all in recent times in the relationship with Indonesia, in a diplomatic sense? I suppose the question is: were you aware of it, Mr Cox?

Mr Cox : I think the Indonesian government believes that our handling of crew and also of minors is very good. I think that the Indonesian government has welcomed the management by the Australian government of returning crew and making sure that we ensure that minors are not caught up in detention—

Senator IAN MACDONALD: So you are saying the Indonesian government are condoning criminal activity?

Mr Cox : No. What I am saying is that our policies for repatriation of such people are welcomed by the Indonesian government. I think they think that our approach is very humane.

Senator IAN MACDONALD: But they accept that it is a breach of Indonesian law to become involved in people smuggling?

Mr Cox : Yes. I am not commenting on that. I was commenting more on their approach to the way we treat these people and that they regard our treatment of them—

Senator IAN MACDONALD: Well, we treat them in the Australian way.

Mr Cox : as humane, and they do not have any grounds for complaint with our treatment of these people.

Senator IAN MACDONALD: Clearly, we treat them in the Australian way—that is, we do treat people humanely, no matter what they are. I asked a rhetorical question. I know the Indonesian government do not condone the crime of people smuggling. But I am just wondering how that fit in with the decision of the previous government not to prosecute a situation which I understand and hope has changed.

Senator Brandis: Yes, it has, Senator Macdonald, and of course the Indonesian government also respects Australia's right to enforce its domestic laws, including its domestic criminal laws.

Senator IAN MACDONALD: Thank you, Minister, and gentlemen. I appreciate your advice. That is all I have on Indonesia.

[14:36]

CHAIR: We now move to the Americas and Africa.

Senator MILNE: I wanted to ask in particular about Uganda and the recent passage of anti-homosexuality legislation, which would see gay people being able to be jailed for life. A newspaper there named the 200 so-called top homosexuals in Uganda. Has the Australian government, through our consular representatives or at any other level, conveyed our condemnation to the Ugandan government over this legislation?

Senator Brandis: The answer to your question is yes, and the level at which the Australian government has conveyed our concern is at the highest level. The law to which you refer came into effect on Monday of this week, 24 February. Yesterday, 26 February, the Minister for Foreign Affairs, Ms Bishop, wrote to the Ugandan Minister for Foreign Affairs, the Hon. Sam Kutesa. I will read into the record an extract, which I might table. She says: 'Honourable minister, I would like to raise Australia's serious concerns with Uganda's anti-homosexuality bill, which was signed into law on 24 February 2014. While Australia respects Uganda's sovereignty, we are concerned that the 24 February law undermines a number of human rights, including the rights to freedom of expression, association and assembly and the prohibition of discrimination. These rights are enshrined in the International Covenant on Civil and Political Rights, which Uganda has ratified, and reflected in Uganda's constitution. Australia believes that human rights should be respected without discrimination on the basis of sexual orientation. Australia has raised these concerns with Uganda, including with you, on a number of occasions since the law was introduced to parliament in 2009. I call now for Uganda to reconsider the law and to exercise the utmost restraint in its enforcement.' I will table that letter.

Senator MILNE: I thank the minister for that and appreciate the action the government has taken. It will be well received around the world together with the condemnation of the United States, Denmark, Sweden and others. I note other countries have taken other measures, including the redirection of aid from government programs to NGOs and civil society, for example. Can the minister indicate if Australia has made any decisions about or given consideration to such measures?

Senator Brandis: So far as I am aware, Australia has made no decisions to that specific effect as an entry into the force of the law on Monday. Whether that matter is under consideration I should perhaps take on notice. You are aware that the entire profile of Australia's foreign aid is under consideration of the government at the moment. That will include aid to African nations.

Senator MILNE: Given that this law clearly is in violation of human rights, does that mean Australia would recognise people seeking asylum, because of this law and the publication of names, to recognise of them as legitimate asylum seekers?

Senator Brandis: That raises the question about whether, if there were any people in that category, they would be regarded as refugees applying the appropriate tests under the convention. That is really a matter for the Department of Immigration and Border Protection. I have tabled the letter.

CHAIR: Thank you.

Senator IAN MACDONALD: What is our aid situation with Uganda?

Mr McCarthy : It is important to point out that our aid program to Uganda is quite modest. It totals about $7.5 million per annum. Unlike some other aid programs that involve direct budgetary support to the Ugandan government—and that occurs in some cases—ours is really targeted at the individual level. It involves scholarships under the Australia Awards and some civil society and global program funding.

Senator IAN MACDONALD: Does any aid go to the government?

Mr McCarthy : No, it is directed at the level of individuals. For instance, a large component of that would be made up of Ugandan students who are currently in Australia under Australia Award grants at various stages.

Senator IAN MACDONALD: I want to be clear about the call that was just made to stop aid to the Ugandan government and send it to civil society. That call be heeded because none goes to the government and all goes to civil society.

Mr McCarthy : That is correct. None goes direct government to government.

Senator MILNE: I turn to Zambia. I understand Australia has a consulate in Lusaka. Did DFAT facilitate the recent visit of Western Australian Premier Colin Barnett? Please give me details of the assistance provided by DFAT to the Western Australian Premier during his visit.

Mr McCarthy : I can answer the first part by saying, as would be normal whenever an Australian state premier was going to a country where a mission is accredited, our embassy in Harare assisted with a number of the logistical and other details of that trip. Ambassador Neuhaus accompanied Premier Barnett on that trip.

Senator MILNE: Can you indicate whether DFAT facilitated any meeting with the Premier of Western Australian with anyone from Zambezi Resources, an Australian mining company currently seeking exploration and mining approval in Zambia?

Mr McCarthy : I would have to take that on notice on that particular question. In the normal course of events, the Premier's program would have originated with and been put together by his own department, but it would be standard that the mission with accreditation to the country would be involved in various aspects—in setting up appointments and so on and so forth. In the case of this particular appointment that you are asking about, I do not know off the top of my head, so I would have to take that on notice.

Senator MILNE: Would you also take on notice whether any meetings were set up not only with the Zambezi Resources, the company, the Vice President of Zambia or any Zambian minister with responsibility for mining, mining exploration, land management and that sort of thing?

Mr McCarthy : Your question is not whether these meetings occurred but whether the embassy in Harare was involved in setting up these meetings?

Senator MILNE: It was whether they occurred, when they occurred, with whom they occurred and what the involvement was of either the embassy or the consulate—and I understand the consulate is voluntary, I think—in setting up those meetings. Further to that, have the Australian embassies, consulates or whatever received any representations with regard to the activities of the Zambezi Resources in Zambia?

Mr McCarthy : I would have to take that on notice.

Senator MILNE: Thank you.

Senator FAWCETT: Turning to Africa and Australian citizens, I notice that the 22nd African Union Summit basically deferred the whole agenda because of security issues that dominated, particularly the Central African Republic and South Sudan. We have a growing diaspora of African people who now have Australian citizenship and clearly many of them go back to Africa. Can you give us an update on DFAT's work with Australian citizens in South Sudan at the moment? What plans do you have for identifying and encouraging an early departure of Australian citizens from other areas, particularly the Central African Republic at this stage?

Mr McCarthy : In respect of South Sudan, as you can imagine at the time that the conflict broke out in the week before Christmas there was very extensive work in terms of our mission in Nairobi which has the accreditation to South Sudan, and also by the consular branch here in terms of identifying Australian citizens in South Sudan. You are correct, the diaspora is significantly large. South Sudanese are the third largest African diaspora group in Australia and a very intensive process was underway between 15 December and probably into the new year in terms of facilitating those who want to leave to depart from South Sudan. It is fair to say that we are conscious of the Australians who are still in South Sudan and those who are still there are people who have made a decision at this stage to remain in South Sudan. Our mission in Nairobi remains in contact with them and if at any time in the future either the situation deteriorates and we need to put out notices about that or they make their own decisions then we would obviously be there to assist.

In terms of the Central African Republic, as you can imagine we have gone to some effort to see if we can identify any Australians resident in the Central African Republic. We do not have any who have registered and from anecdotal evidence, though I cannot say conclusively that there are no Australians in the Central African Republic, but after some effort we have been unable to identify any.

Senator FAWCETT: Can you confirm the number of Australian personnel from the Australian Federal Police or other agencies we currently have in South Sudan and other parts of Africa?

Mr McCarthy : We have about 20 members of the ADF who are deployed with UNMISS and that is the total number that we have on deployment at this stage in Africa.

Senator FAWCETT: Are we predominantly working through the UN? Do we also have contact or dialogue with the African Union security council?

Mr McCarthy : Both. In the case of the ADF who are deployed, that is through UNMISS. That is, if you like, working through the United Nations. But because of our commitments and, in particular, because of our position at present on the United Nations Security Council, we are involved in regular dialogue with the African Union on a range of African security issues. Our mission in Addis Ababa is constantly engaged with the African Union on a range of matters, particularly those that are before the Security Council at the moment.

Senator FAWCETT: Are there any plans for increasing investment in that work, as opposed to broader aid? I am talking about interest of the broader African community—and the international community—in health and safety. At the moment, when either a natural disaster or a man-made disaster occurs, nations such as Australia end up committing people and resources. Generally, prevention is better than cure. Given that the African Union is looking to try and establish protocols—even a standing military force for intervention and stabilisation—what consideration is being given to the cost-effectiveness, if you like, of investing in that aspect rather than in lots of the recovery-type aid programs we commit to after a disaster has occurred?

Mr McCarthy : You raise a very important point. Australian commercial interests in Africa are now very widespread. There are, to put it bluntly, a lot of Australians spread in ways that I think would surprise many in the general community—just how far we are spread and how many people we have in so many places. There is a review of the department's FTE—our people and where they are allocated—underway. The question of whether there is a case for supplementation of some of our African posts is a matter that will arise as part of that overall consideration of where the department's staffing resources are spread.

Senator FAWCETT: I am even looking beyond DFAT at a whole-of-government response. Are you looking to recommend to government more broadly that, rather than in a reactive way putting people into things like UNMISS, perhaps we should, in a proactive way, be seeing how we can help train and support people like the AU to raise up their capability to prevent problems and undertake the kind of stabilising role that the ADF is very engaged with in, for example, the Pacific region?

Mr McCarthy : Some of that work is already occurring, but we are always looking for opportunities to expand the engagement, particularly on that peacekeeping and stabilisation function—where this country of course has a lot of very good and very positive experience.

Senator DASTYARI: Thank you for being with us today, Dr Hammer. Foreign minister Bishop visited the United States in late January—just before Australia Day this year. Is that correct?

Dr Hammer : That is correct.

Senator DASTYARI: Who accompanied her on that visit?

Dr Hammer : For the entire visit, there were three. There was the foreign minister herself; her chief of staff, Murray Hansen; and me.

Senator DASTYARI: The media reports might be wrong then. Was the Prime Minister's national security adviser on the trip?

Dr Hammer : The Prime Minister's national security adviser was in Washington, if memory serves, attending a meeting at CSIS.

Senator DASTYARI: That is probably where the mix-up in the media reports comes from.

Dr Hammer : He was attending that meeting and the foreign minister gave a speech there. There were some events where they were there together. I think he was also in New York for a while, but it was, in a sense, a matter of coincidence that they were in the same cities at the same time.

Senator DASTYARI: His travel, obviously, would not have been prepared by DFAT. That is a matter for Prime Minister and Cabinet—is that correct? You did not have anything to do with it?

Dr Hammer : Foreign Affairs and Trade had nothing to do with his travel.

Senator DASTYARI: I completely understand. The foreign minister did give a speech. The speech itself—I am sorry; I am getting my dates mixed up—was on the 22nd or the 23rd? It was on the Saturday?

Dr Hammer : It was on 22 January.

Senator DASTYARI: That was a Wednesday?

Dr Hammer : That is correct.

Senator DASTYARI: And you were there?

Dr Hammer : I was there.

Senator DASTYARI: And that was at the CIS?

Dr Hammer : The CSIS—the Center for Strategic and International Studies.

Senator DASTYARI: What was the out-take from the speech she gave at that function?

Dr Hammer : 'Out-take', for me, is a rather colloquial expression. If you could give me a little bit more to go on, it would be helpful.

Senator DASTYARI: Let's take a step back. Obviously a whole series of meetings were held—very appropriately and at a high level. There was a private meeting with Vice President Joe Biden. After that, Foreign Minister Bishop was quoted as saying 'our single most important economic partner is in fact the United States, so in respect of who is our best friend in economic terms, it is undeniably the US'. Was that part of the speech, or was that part of private statements to the media? It is cited as being part of the speech, but I am not quite sure whether it actually was.

Dr Hammer : I have got the text of the speech here, and I am happy to table the speech. I cannot remember it word for word, but certainly that is a statement which the Foreign Minister did make publicly. She characterised the relationship as 'our most important economic partner'.

Senator DASTYARI: I want to go back to the idea of ranking our economic relationships. Statements of this kind are made by ministers and are effectively the prerogative of government. Were these statements made independent of advice? Was it a matter that the Foreign Minister did independently?

Dr Hammer : The formulation of the US being Australia's 'best economic friend' was probably somewhere in between. We certainly, as an organisation, provided advice to the Foreign Minister's office on what the actual numbers were. If you look at Australia's two-way trade with the United States, which is around $54 billion—admittedly not as large as our two-way trade with China—

Senator DASTYARI: What is our two-way trade with China?

Dr Hammer : It is $131 billion. The most important element here is that we also focus on inward investment into Australia.

Senator DASTYARI: Do we though?

Dr Hammer : We do. If you look at an economic relationship, it has to take into account more than simply our trade.

Mr Varghese : Senator, I do not think the line you quoted was in the speech. I do not have it in front of me.

Senator DASTYARI: And the media reporting merged the speech with other comments, which makes it somewhat unclear what was said where. And I stress that that is not the significance of it; more significant are the comments themselves. What was the purpose of saying that? Was it about an investment pitch in the US?

Mr Varghese : There is nothing new about the proposition that, if you take trade and investment and aggregate them, the United States as an economic partner is in a league of its own. This is something which Australian ambassadors to Washington have been saying for a very long time. I know that Kim Beazley says it regularly in Washington. I can recall Dennis Richardson saying it when he was ambassador. I can remember Michael Thawley saying it when he was ambassador.

Senator DASTYARI: I did not imply that it was not. I just wanted to get an understanding of the trade and investment components of it.

Mr Varghese : An economic relationship has many parts.

Senator DASTYARI: I have not heard a foreign minister say it before, by the way; but that is not to say they have not. You can take it on notice to find out whether a has articulated our trade relationship in that way at an international level.

Mr Varghese : Yes. I mean, it is not a radical proposition: an economic relationship consists of a number of elements, of which trade and investment are two very important elements. China is our largest trading partner. But if you look at trade and investment together, which is entirely legitimate thing to do, the United States is in a league of its own.

Senator DASTYARI: I am not disputing the facts; they speak for themselves and, in many ways, they are undeniable. My question is: is the ranking of economic relationships based on the advice of DFAT? It sounds like what you are saying is that the facts speak for themselves and how they are articulated is a matter for the minister. Is that a correct way of articulating it?

Mr Varghese : No. what I was also saying is that, in Washington, successive Australian ambassadors have been saying the same thing for quite a long time.

Senator DASTYARI: But ambassadors in Washington are not Australia's Foreign Minister—some of them have been, I might add!

Mr Varghese : No, but they do speak for the Australian government.

Senator DASTYARI: I want to give you the opportunity to put your views—and I think we disagree on this. On 24 October the Trade Minister, Andrew Robb, said: 'There are lots of negotiations the Chinese government is participating in in a trading sense. If we do not put out a signal that we rate this free trade agreement highly, then we will be pushed to the back of the queue, and justifiably.' I worry—and I want to get Dr Hammer's views on this as well—that the way in which the Foreign Minister has ranked economic relationships risks sending out the wrong signal, even though it may be numerically correct.

Mr Varghese : I do not think it will have any implications for the negotiations with China on an FTA. We are negotiating an FTA with China on the basis that we think there will be mutual advantage in concluding such an agreement. We are keen on it. China—

Senator DASTYARI: But the status of the relationship obviously has an impact on that.

Mr Varghese : The status of which relationship?

Senator DASTYARI: The relationship with China has an impact on the process; that is a given.

Mr Varghese : FTA negotiations are concluded in the context of a broader bilateral relationship, absolutely.

Senator DASTYARI: Yes, of course; that is a statement of fact.

Mr Varghese : Why would the Foreign Minister's comments in Washington of a factual nature, about where the United States stands when you add trade and investment together, have any adverse impact on our ability to negotiate an FTA with China?

Senator DASTYARI: My concern is that a series of decisions, events, comments, statements, communiques and whatnot has created a situation where the signals we are sending to our largest trading partner are not that we are prioritising or valuing that relationship.

Senator Brandis: The point you make is preposterous. It is absolutely preposterous that you could say that. It has absolutely no basis.

CHAIR: Wait a minute, Senator—

Senator DASTYARI: If the minister feels the need to interject, I am happy to have a discussion with him.

CHAIR: He is entitled to make a comment.

Senator Brandis: I do not want to have a discussion with you. I just do not want to go uncorrected on the public record something that is both preposterous and completely at variance with what you have just heard from the officials.

Senator DASTYARI: Minister, the fact that you sit here and pretend that the relationship with China is not in a difficult position right now—

Senator Brandis: I think Mr Varghese, the Secretary of the department, will be in a better position to assess the relationship than either you or me—and you heard his evidence this morning.

Senator DASTYARI: Dr Hammer, can we go back to the discussion about the trip on 22 January. The trip went to Washington, New York—and where else?

Dr Hammer : The third city we visited in the United States was Chicago.

Senator DASTYARI: We have been given a fairly good update on the Foreign Minister's trips, and who travelled with her and whatnot, which is a generic question that is asked at every estimates. Can I have on notice an update that includes the details of this trip?

Mr Varghese : As to where the Foreign Minister went?

Senator DASTYARI: This is a standard question on notice—where the Foreign Minister went, who the Foreign Minister travelled with, and what official meetings were held by the Foreign Minister.

Senator Edwards interjecting

Senator DASTYARI: This is a question we ask every time.

Senator EDWARDS: I know; and I am sure you will be riveted with the answer!

Mr Varghese : We can certainly provide that information.

Senator IAN MACDONALD: Mr Varghese, is a schedule publicly issued by Foreign Ministers when they go overseas?

Mr Varghese : Typically the minister would issue a press release indicating that she was making the trip and what she expected the main themes of the trip would be. That press release may also refer to particular meetings that she is having. But it is not the practice to publish the full list of appointments.

Senator DASTYARI: I will conclude by putting that question on notice. It is a table that has been provided in the past.

Senator Brandis: Senator Dastyari, Dr Hammer has kindly advised me that he in fact has that material here in the hearing room. So perhaps he can table it, or read it into the record.

Senator DASTYARI: Tabling it would be fantastic.

CHAIR: How long is it?

Dr Hammer : It is a three-page table which covers the entire visit to the United States.

Senator IAN MACDONALD: What is that document?

Dr Hammer : It is simply some notes which I have on all of the appointments which the Foreign Minister had when she travelled to the United States in January.

Senator IAN MACDONALD: But you do not, as a matter of course, issue them after the event? It is not standard practice?

Dr Hammer : No, we do not. This document was prepared for me, for use in these estimates, in the expectation that we may be asked a question.

Senator IAN MACDONALD: Was that sort of thing published by previous Foreign Ministers after they returned—where they went, what they did, who they met?

Dr Hammer : In my experience, no; it is not routine at all to publish that sort of information. But nor has it been kept secret. I think that, if people have asked, it has been available.

Senator IAN MACDONALD: We did hear a lot in previous estimates about the previous Foreign Minister and some of his activities. I just wondered if it was a normal situation.

Mr Varghese : Chair, I think what would be most helpful is if we tabled, in the same format that we provided previously to this committee, the relevant details of the Foreign Minister's trip to the United States—and we will do that very quickly.

Senator DASTYARI: And not just that, but other trips since the last stuff that you provided to this committee.

CHAIR: Thank you, Senator—if the department is willing to do that. Senator Rhiannon.

Senator RHIANNON: I would like to ask you about the situation in Grenada with regard to their parliament building and our interaction with that. How was the decision made to cut the $5 million promised for the construction of their parliamentary building?

Mr Varghese : That was a decision taken in the context of the broader reduction in the aid program for the current financial year, 2013-14. The government had to make cuts in a number of different areas. Latin America and Africa were two regions where we did make cuts. That particular project was one of the cuts that were made.

Senator RHIANNON: How were the authorities in Grenada informed?

Mr Varghese : We have informed the Grenada government of the decision.

Senator RHIANNON: Is it true that this cancellation was reported in the paper before the government was officially informed?

Mr Varghese : I do not know the answer to that question. I would be a bit surprised if that were the case, but I am happy to check it.

Senator RHIANNON: You will take that on notice?

Mr Varghese : I will.

Senator RHIANNON: Has any compensation been given to people or companies who had already been contracted to undertake the work to build this parliament?

Mr Varghese : Some of the money in the original agreement has already been paid. From memory, it is about $1 million, but I will have to check that. Obviously that is money that has been spent and cannot be recouped. But, for the balance of what we committed to that is unspent, we will not be proceeding.

Senator RHIANNON: The question was: have any of the contractors or companies, or anybody associated with the work, not been paid for the work that they commenced? Clearly it was an ongoing project. At the point you decided to stop it, did you ensure that everybody was paid up until that point?

Dr Hammer : The support to Grenada on the building of their new parliament house was a staged exercise. The secretary has already mentioned that about $1 million had been spent already. That concluded the first phase—planning and design and so on and so forth. It is really the next phase, which is a $3.5 million phase, which the government decided not to proceed with. My understanding is that there are in fact no legally binding contracts in relation to that phase. So there are no people on contract who would need to be compensated.

Senator RHIANNON: Do you need to take it on notice to check that?

Dr Hammer : No. I have checked. I did ask, before I came up here, whether there are any contractual obligations. The check has been done a number of times by my people, so I am quite confident that there are no contractual obligations.

Senator IAN MACDONALD: Excuse my ignorance, but is Grenada in the Caribbean?

Dr Hammer : That is right.

Senator IAN MACDONALD: Do we have the details of who the $1 million was actually paid to? Was it paid to the government, or to an individual?

Dr Hammer : It probably went to more than one place. I do not have all the details here, but we can get that to you on notice.

Senator IAN MACDONALD: When was this done? Was this done around the time of the flurry of our Security Council campaigning? I am not saying it was done with that in mind; obviously I would not suggest that.

Dr Hammer : It was done around 2009.

Senator IAN MACDONALD: When was our Security Council campaign?

Dr Hammer : I was posted overseas, in Tokyo, at the time of that campaign. So all of the timing associated with that, I am not familiar with. But I would add that, on 30 January 2012, we made an agreement—not a contract, a treaty or anything like that—that we would build the Grenadian parliament house. As to the campaign, that is something I do not really have expertise in.

Mr Varghese : I think it was 2008.

Senator IAN MACDONALD: When was the vote?

Mr Varghese : We will get the date for when we formally announced the campaign.

Senator IAN MACDONALD: I am surprised about Australia's interest in Grenada; it is good that we help underdeveloped countries. I would be interested in knowing who the $1 million actually went to—did it go through the government, or through an NGO, or to individuals, or to several individuals—and for what purpose.

Dr Hammer : I have some details here but they do not go precisely to the issue of who, in particular, was paid money; it just goes to what the money was used for. For example, there was a project architect who was taken on and the money was essentially used in preparation of a project design document. Who precisely was involved—

Senator IAN MACDONALD: If there is no breach of individual privacy I would be interested to know a name, but more interested to know how the money flowed to his one or more individuals. Did it go through the government? Was there a Grenadian government tender process for the architecture? How precise, by Australian standards, was the whole spending of the $1 million? If you have got that now, that would be good.

Ms Robinson : We will have to take your question on notice to give you full details, but my understanding was that the contracting of the architect for the design of the document was done separately and it was done through the Australian aid program.

Senator IAN MACDONALD: Through the Australian aid program?

Ms Robinson : Yes.

Senator IAN MACDONALD: Excuse my ignorance, this is unforgivable, is the government of Grenada a democratically elected government?

Ms Robinson : Yes.

Senator IAN MACDONALD: Do we have a post there at all?

Ms Robinson : No. We have one post in the Caribbean and that is in Port of Spain. In Trinidad.

Senator IAN MACDONALD: And they have elections every three or four years in Grenada.

Ms Robinson : I am not sure of the timeframe, but they are a democratically elected government, yes.

Senator IAN MACDONALD: If you give me that detail. Has Australia got a big aid project in Grenada?

Ms Robinson : No, this was a singular direct program. We did, in the past, have a program which included some scholarships and broader assistance to the Caribbean.

Senator IAN MACDONALD: How distant past is the scholarship program? Or did that come around post 2009 as well?

Ms Robinson : There was an MOU signed in 2009 with CARICOM, the organisation of Caribbean states.

Senator IAN MACDONALD: Do we have any consular representatives in Grenada?

Ms Robinson : Not to my knowledge, no. It is a small country with a small population.

Senator IAN MACDONALD: I would be interested—and I suspect I can ask this knowing that you are not going to waste a lot of paper writing out the answer for me—in the recent diplomatic engagement or aid engagement we have had with Grenada. Can anyone tell us how Grenada voted in the Security Council activities?

Dr Hammer : My understanding is that the CARICOM countries voted en bloc for Australia.

Senator IAN MACDONALD: That raises the issue—what other recent aid support have we given to the Caribbean countries. What did you call them?

Dr Hammer : CARICOM. It is the organisation of Caribbean countries.

Senator IAN MACDONALD: If you can tell me without it quickly you can tell me now what other aid we have given to the Caribbean in recent years and forever, otherwise I might have to take it on notice.

Mr McDonald : We gave $60 million to the Caribbean over four years which will be completed at the end of this financial year.

Senator IAN MACDONALD: So four years ago that was—that is 2009 as well. How many of those countries have a vote in the UN?

Mr McDonald : I am not aware.

Mr Varghese : All of the members would have a vote in the UN.

Senator IAN MACDONALD: But how many of them are there in CARICOM? That is what I am really saying.

Mr Varghese : We will get back to you.

Mr McDonald : We will take that on notice. Ten or so.

Senator IAN MACDONALD: Thanks very much.

CHAIR: I think one of the officers wants to add something.

Mr McCarthy : Just to correct the record on a minor piece of my testimony, when Senator Fawcett asked me how many registered Australians we had in the Central African Republic I said zero. In fact I am advised that we now have two people who have registered in the Central African Republic.

CHAIR: That is very interesting, I must say. Thank you very much.

Proceedings suspended from 15:20 to 15:42

CHAIR: We will resume. We plan to finish all the specific-country questions by half past four and then move into the aid budget so that we can finish by the scheduled dinner break. Unfortunately, we have exactly the same agenda for estimates, whether it is a two-day estimates or a four-day estimates. It is difficult to get through the program in a two-day estimates.

Senator Brandis: Can I add one further particular to an answer I gave this morning to Senator Milne in relation to the detention in Egypt of the Australian journalist Peter Greste. I said that the foreign minister had raised the case directly with the Egyptian foreign minister and with the Egyptian ambassador, and that the Australian ambassador to Egypt, Dr King had raised the matter several times with relevant entities of the Egyptian government. I neglected to say that on at least two occasions the Prime Minister himself has made public comment on the importance of the Egyptian showing respect for press freedom and the rights of journalists to engage in their profession, or words to that effect.

Mr Varghese : Can I just go back on two points that Senator Macdonald raised: 29 March 2008 is the date on which then Prime Minister Rudd announced our candidature for the UN Security Council; and 15 is the number of member states of CARICOM.

CHAIR: Thank you, very much.

Senator DASTYARI: I might put our questions on Europe on notice. Is that okay?

CHAIR: We are very pleased about that. That is very helpful.

Senator RHIANNON: Are you aware of the recent report released by the Public Interest Advocacy Centre on Sri Lanka entitled, Island of impunity? Investigation into international crimes in the final stages of the Sri Lankan civil war?

Mr Robilliard : Yes.

Senator RHIANNON: Given that the report highlights strong evidence for the need for an international investigation into war crimes and the Sri Lankan civil war, has the department had any discussions with Sri Lankan government with regard to the possibility of an international investigation?

Mr Robilliard : The government engages with Sri Lanka on a range of issues relating to human rights matters.

Senator RHIANNON: Have you specifically spoken about and international investigation?

Mr Robilliard : I think the issue of an international investigation is part of the general debate or discussion on the Sri Lankan human rights record; yes.

Senator RHIANNON: You said that you think that is the case; does that mean you need to check?

Mr Robilliard : I will take it on notice to see if there are any specific occasions.

Senator RHIANNON: Thank you; take it on notice. The United States is preparing to introduce a resolution to the United Nations Human Rights Committee in March with regard to an independent international investigation into Sri Lanka. Has the department approached the US or any other nation in relation to this resolution?

Mr Robilliard : I think the resolution is about the human rights situation in Sri Lanka. I am not sure that it is directly directed at the matter of an international conference or an international investigation.

Senator RHIANNON: Again, you said that you think that is the case. Does that mean you have approached the department about this and that is what you now understand the motion is, or is it that you speculate that it may be?

Mr Robilliard : This resolution has been run for the past two years. This will be the third year. In the past two years the resolution has been about the general situation.

Senator RHIANNON: So at the moment you have not had any discussions with the department that the content of the motion may have changed.

Mr Robilliard : We have not seen a draft of a resolution.

Senator RHIANNON: Recent reports have suggested Australia is attempting to weaken or derail negotiations around the US resolution. Has Australia been engaging in any discussions that may not be consistent with the US position?

Mr Robilliard : To the best of my knowledge, Australia has not been engaged in any discussions along the lines of the report to which you refer.

Senator RHIANNON: Again, you said, that that was to the best of your knowledge. Could you take the question on notice so that you can confirm that, one way or the other.

Mr Robilliard : I think I could confirm that we would not have engaged in a way that that report has characterised.

Senator RHIANNON: Thank you. What is the position you have been asked to advocate?

Ms Sidhu : We have not formally been asked to advocate a position. We are waiting to see the text of the resolution before we determine what position we will take.

Senator RHIANNON: Could you explain why there is a difference in reporting on conditions of Tamils in the north of Sri Lanka between statements from the Australian High Commission and the findings of non-government organisations that work in this area?

Mr Robilliard : Which statements of the High Commission are you referring to?

Senator RHIANNON: We saw the comments that the Prime Minister made when he was at CHOGM, and there have been statements effectively negating that crimes against humanity have continued since 2009.

Senator Brandis: Senator Rhiannon, I think you should not, if I may say so, attribute words to the Prime Minister without quoting his actual words. The statement you have just made, although you have attributed it to the Prime Minister, is, to the best of my knowledge, not a statement that the Prime Minister has ever made. He has made some observations in relation to the Sri Lankan civil war but not as sweeping or as simple as what you have just attributed to him. So if you are going to ask the official to comment on something the Prime Minister might have said, I think you should do both the Prime Minister and the official justice by quoting his actual words, not your interpretation of his words.

Senator RHIANNON: I do ask for the official to comment again that the Australian government has a different position from the NGOs. The Australian government did supply two Bay-class patrol boats to the Sri Lankan government. When the Foreign Minister, prior to the election, was in the northern part of Sri Lanka and when she was questioned about that, it was not acknowledged that there were crimes against humanity. Similarly, if the Prime Minister stands with the President of Sri Lanka, Mr Rajapaksa, and again does not acknowledge crimes against humanity, this is a fair question. So could I ask: why is there a difference in reporting on the conditions of Tamils in the north between Australia's position and non-government organisations that work in that area?

Mr Robilliard : I cannot comment or speak on the basis NGOs may make their reports. Our high commission makes its reports based on its visits to the area and its discussions with a range of people in that area.

Senator RHIANNON: What discussions has DFAT taken to raise concerns about human rights abuses in Sri Lanka?

Mr Robilliard : The government has taken a very active position on issues relating to allegations of human rights violations. As you will be aware, and as you have referred to, the Prime Minister and the Foreign Minister were both in Sri Lanka at the time of CHOGM. There were discussions on human rights issues there. We take the matter of allegations of human rights abuses very seriously. The government takes the position that it is the most productive way to deal with these matters through engaging the Sri Lankan government rather than looking to isolate it.

Senator RHIANNON: How many AFP officers or personnel are attached to the Australian high commission?

Mr Robilliard : That is a question I think you would have to ask the AFP.

Senator RHIANNON: I am asking in the context of the Australian high commission—what understanding the high commission has with regard to the AFP people that work out of its headquarters?

Mr Robilliard : I am sorry, are you asking a question about how many there are or what work they do?

Senator RHIANNON: I would certainly like to know both, but I appreciate that you have said that I should go to the AFP. But as I understand that they work out of the Australian high commission I thought it was a relevant question to ask here at DFAT.

Mr Robilliard : There is nothing I can really offer you further.

Senator RHIANNON: You mean you have no information about how many AFP officers operate out of the high commission in Colombo?

Mr Robilliard : Not with me, no.

Senator RHIANNON: But surely you must. DFAT looks after the Australian high commission. Isn't there somebody here who would know?

Mr Varghese : We can take that on notice and get back to you with the number.

Senator RHIANNON: Thank you. Also if you could take on notice what functions the AFP officers perform out of the Australian high commission, how many Australian Defence Force personnel are attached to the Australian high commission and I was interested in their length of attachment.

Mr Robilliard : Again, that is primarily a matter for the Department of Defence, but I will take it on notice and see what information we can provide.

Senator Brandis: That having been said, we are not going to be asking DFAT officials to make inquiries of the Department of Defence that you could have made.

Senator RHIANNON: I am not asking you to do that, and you know that, Minister. I am asking what your understanding is. DFAT looks after the Australian high commission in Sri Lanka, in Colombo, and clearly you would have some advice given to you about how many AFP/ADF people work out of there.

Senator Brandis: That is true, and that question was taken on notice by Mr Varghese. But then you asked other questions like, for example, the length of the rotations and so on. It is by no means obvious to me that DFAT would be possessed of that knowledge, because—

Senator RHIANNON: I would say it would be relevant because the high commission would have to know how many personnel it has operating out of the high commission. Otherwise it is not being very effective and efficient.

Senator Brandis: That may be so, but at any given time DFAT, you would expect, would know how many personnel are operating out of the high commission. That is why the question was taken on notice. Nobody said that was not a proper question. But you then asked other things about the rotation of AFP personnel through this post, which it seems to me—

Senator RHIANNON: Actually I said time of attachment, which is relevant to who is operating out of the high commission. It is a very straightforward question.

Senator Brandis: As I say, I think that is a question for the AFP or perhaps the defence department, but in any event the DFAT officers will respond to so much of the question as is within their knowledge, but I am not going to expect them, and I am sure the minister will not expect them, to make inquiries of other departments and other agencies to supply you with information that you neglected to ask about in the correct estimates hearing.

Senator DASTYARI: I am conscious of the time constraints so I will put some more detailed questions on notice. Is it fair to say that there was a reversal of Australia's position in the UN on Israeli settlements, as was flagged by the Prime Minister and the foreign minister before the election in their election documents?

Mr Varghese : I think there were three resolutions at the most recent General Assembly where Australia's voting position differed from the voting position of the previous government. The reasons for that would go to the balance of the resolution and a range of factors, so it is not necessarily just a matter of the one issue.

Senator DASTYARI: Sure, and I do not want to harp on this because I do not think it is contested that there were different positions on this issue taken to the last federal election, and that is what elections do—they settle these things. Did the foreign minister visit Israel in January of this year?

Mr Varghese : She went for the funeral of Ariel Sharon.

Senator DASTYARI: But was there a visit around that as well?

Mr Varghese : It was a very short visit—I think she might have had a meeting with the foreign minister of Israel. It was not a bilateral visit—she was there for the funeral.

Senator DASTYARI: I know we have already put a question on notice about getting some information in the table form that we always get it in, so I will leave that. Is it is a matter of fact that the minister made statements to the Israeli media regarding the legality of settlements?

Mr Varghese : I do not think she made statements that had the effect of offering a view about the legality of the settlements, if that is what you are suggesting.

Senator DASTYARI: Has the department been asked to provide advice in relation to the legality of settlements?

Mr Varghese : The department has provided advice on the legality of settlements.

Senator DASTYARI: Was that advice provided to both the last government and this government?

Mr Varghese : I would expect we have provided advice on this issue to successive governments.

Senator DASTYARI: Has that advice changed?

Mr Varghese : I do not think the burden of the advice has changed but we have our legal adviser present and I am sure she could help.

Senator DASTYARI: I am not asking what the advice is; I am asking whether the same advice has been provided to both governments.

Mr Varghese : I think the departmental legal view has been fairly consistent for some time.

Ms Cooper : You would know, Senator, that as a general proposition we do not disclose the content of legal advice.

Senator DASTYARI: I am not asking for the content.

Ms Cooper : Questions about to what extent our advice has changed or not may well go to content advice in some circumstances. Certainly the general proposition that the secretary has outlined is correct.

Senator DASTYARI: We will go to the detail of the foreign minister's statements on notice. But was DFAT consulted on the foreign minister's statements?

Mr Varghese : Are you referring to the comments she made in an interview while she was in Israel?

Senator DASTYARI: Yes.

Mr Varghese : She made those comments in an interview. She was not working off a departmental script, if that is the question. She would of course had briefings as part of the visit to Israel.

Senator DASTYARI: Would there have been someone from DFAT travelling with her?

Mr Varghese : I am just trying to think, because this was put together very quickly. I know her chief of staff went with her.

Senator DASTYARI: I have already asked this on notice, so we can—

Mr Varghese : Actually, I do not think a departmental officer went with her.

Senator DASTYARI: The United Nations has called for a $6½ billion appeal for relief to the Syrian refugee camps. This is something I am quite passionate about. I congratulate the government on responding and pledging an additional $12 million in difficult economic times; I think it is the right thing to do.

I know there are many people—and there are many people in the community in Sydney and people I know quite well—who feel there may be the opportunity to provide more support as we put together the forward-going aid initiatives. I just want to get a quick understanding of what discussions are in place at the moment on possible further relief for the plight of the Syrian refugees.

Mr Varghese : We will address the question of aid to Syria in the context of the 2014-15 budget. That is where final decisions would be made. We have provided $112 million to Syria, which I think is a very substantial contribution. I know that the dimensions of the humanitarian crisis in Syria—

Senator DASTYARI: I noted that the $12 million was in addition to what had already been pledged.

Mr Varghese : That is right.

Senator DASTYARI: I am just wondering what budget allocation that came from.

Mr McDonald : That would have come from our mandated flexibility fund as well as from some of our program funding.

Senator DASTYARI: I think it is a good initiative, and I congratulate the government on it.

Senator FAWCETT: Mr Varghese, could you update the committee on the UN resolution on Syria and Australia's role in it?

Mr Varghese : I will see if colleagues want to add to this. I assume you are talking about the resolution that passed last weekend.

Senator FAWCETT: Yes

Mr Varghese : For a very long time, at least in terms of action in New York, we have been seeking in the Security Council to have a resolution passed which goes to the question of humanitarian access and which creates certain obligations on the part of the Syrian government, and also on the part of other parties, to permit humanitarian access—and particularly to permit cross-border access. We have been working very closely with, in particular, Luxembourg and Jordan on that. We were very pleased that finally, over the weekend, we were able to get that resolution through without attracting a veto.

I think the resolution is significant in that it calls for action which could significantly improve the provision of humanitarian relief in a situation which is of enormous dimensions. The big issue will be whether the calls in the resolution are abided by and observed by all of the parties—in particular the government of Syria.

Senator FAWCETT: You mentioned 'all of the parties'. Could you outline for the committee which parties you mean? The media are reporting it very much as a resolution that calls on the Syrian government to allow access. Are there other parties—

Mr Varghese : I will ask Mr Merrill to respond to that. It certainly places obligations on the Syrian government, but I do not think it is exclusively the Syrian government.

Mr Merrill : I might ask my colleague Marc Innes-Brown from the Middle East branch to add to this. The resolution very consciously addresses all parties to the conflict, but it also recognises that there is a disproportionate weight of responsibility. In the view of the council and of the international community the weight of responsibility does primarily fall on Syrian authorities there.

I would also add to the secretary's comments that it is a significant resolution—it is a breakthrough—but the importance really is now on implementation. The resolution does include provisions on monitoring. There will be a 30-day reporting cycle and the secretary will come back and—importantly; this was one of the sticking points in the negotiations—the resolution clearly states the intent to consider further steps if progress on implementation is not made to the satisfaction of the council. That is not going to be an easy thing to do, but, in the context of the Syrian conflict—with the exception of the chemical weapons resolution last year—in a three-year period, this is perhaps the most significant demonstration of council unity and willingness to address practical action to help the Syrian people.

Senator FAWCETT: I commend your team and the work that has happened to get this outcome. But it has been a military stalemate for the last 18 months, and it says that both sides have a significant amount of control in terms of access. So I am seeking some assurance that Australia will be pressing through the UN Security Council process for both parties and—given that there are many who believe this is a proxy war between different powers in the region—that we would also be looking to engage constructively with the supporters of both sides of the conflict to make sure that we can address the humanitarian side.

Mr Merrill : Yes, Senator. As I said, the provisions in the resolution are not exclusively directed at the Syrian authorities, and I think we will see that, through the 30-day reporting cycle and through the regular briefings we get from UN agencies which are working in opposition controlled areas, there will be advice provided on their assessments on implementation there.

I think that, if the council is going to take further steps, you would be looking at coercive measures such as sanctions and that they would apply to individuals and entities which could be government authorities or other opposition groups. I can guarantee that there are members of the council who will ensure that its approach is as even-handed as possible.

Senator FAWCETT: Is there any specific effort going into trying to assure the rights of minorities in Syria? Everyone there is suffering, but there appears to be particular suffering on the part of some of the minority groups in Syria, given that both of the major combatants—whether it is the disparate opposition side or the government side—do not include those minorities as part of their group, so to speak.

Mr Merrill : I think the council has been primarily focused, as it should be, on the principle of the protection of civilians, writ large. That encompasses all minority groups. I do not think any distinction is made there in the demands that the council has placed on parties in terms of their responsibilities and the priorities of access and getting humanitarian aid to vulnerable groups. That is where we are with the council. Mark, do you want to add anything on the minority question?

Mr Innes-Brown : As Mr Merrill said, the conflict as it has evolved has unfortunately taken on a sectarian dimension. It is affecting all communities whether they be Alawite, Sunni or Christian. The ethnic composition of Syria is very diverse and there are many different groups so it is of concern. Australia was a cosponsor of a UN General Assembly resolution late last year which did address the issue of ensuring that the protection of various groups and genders were protected as an observance of universal human rights and fundamental freedoms. It is an issue but, unfortunately, as we have just been saying, the Syrian conflict has affected the whole of the Syrian community.

Senator FAWCETT: I recognise that within the borders of Syria it is obviously very difficult for the UN to enforce or carry out many things. But for the UN camps that are outside of the borders, I am still hearing reports of minority groups either being denied access or being denied the same level of service as the majority of the refugee population there. Has the UN taken any specific steps to address that?

Mr Innes-Brown : I am not aware of that. I have not heard those reports myself. I will have to make some inquiries and get back to you on that particular issue.

Senator FAWCETT: If you would like to follow up after estimates, I am happy to put you in contact with some people that could provide some information on that.

Senator IAN MACDONALD: Mr Varghese, could you tell us where we at in the foreign minister's recent announcements on Fiji?

Mr Varghese : Prior to the election, the coalition indicated that they wished to reset the relationship with Fiji and to move, over time, to fully normalise it. That objective was very much at the forefront of the foreign minister's discussions with Frank Bainimarama, the Prime Minister of the interim government. It was a very constructive discussion. The foreign minister explained the new Australian position, obviously encouraged Fiji to ensure that credible elections were held in September or October and indicated some steps that Australia was willing to take in the lead up to those elections. They also discussed what we might be able to do in initiating a program of capacity building in the public sector as well as restoring and strengthening the business ties between the two countries, and began a discussion on a defence cooperation program which would be able to be implemented post a credible election.

Senator IAN MACDONALD: How was Ms Bishop's recent announcement greeted by other nations in the Pacific region?

Mr Varghese : She undertook the visit in the context of the so-called MCG, the ministerial contact group, in Fiji, which is chaired by New Zealand and includes a number of other Pacific Island Forum countries. We have ensured that we have kept all of our Pacific neighbours informed of developments in our thinking and of the direction in which our policy is heading. My sense is that the ministerial contact group was comfortable with the Australian position.

Senator IAN MACDONALD: Finally, excluding PNG, what is Fiji's status economically, politically and population wise to all of the other Pacific Island nations?

Ms Klugman : Fiji traditionally and currently plays quite an important role in the region. It has one of the more substantial economies. It has some of the potentials associated with its hub status, both in the site of the largest Pacific university, for example, and in air connections. It has played quite an important role as a leader in the Pacific. We are hoping that it can resume that role, and one of the most important elements of that will be Fiji's return to the Pacific Island Forum—we hope, following credible elections—by September this year.

Senator IAN MACDONALD: Do we have an indication of when the elections will be?

Ms Klugman : Yes. The new constitution of Fiji requires elections to be held by September this year.

Senator IAN MACDONALD: Going back to your previous answer, would it be true to say, in layman's terms, that apart from PNG Fiji would be the leading nation in the Pacific region?

Ms Klugman : I think that is right. You might have a few arguments from New Zealand. But both in economic terms and in the role they have played traditionally, yes, I would put Fiji in that category.

Senator FAWCETT: Mr Varghese, could you tell me whether the department carried out a review of Australia Network's effectiveness prior to the former government's decision to continue the service?

Mr Varghese : Prior to the former government's decision? We are going back to a time when I was not in Canberra. I will ask my colleagues. I know we certainly did address this question of how the network was functioning and what the view of our regional posts were, because I can remember contributing to it from Delhi.

Mr Tranter : The department has carried out regular reviews of the service over the years through seeking feedback through our post network. I am not aware of a formal major stocktake of this service ahead of that contracting process.

Senator FAWCETT: Was an evaluation done as to whether the service met its key performance indicators before it was renewed?

Mr Tranter : I will have to take that on notice.

Senator FAWCETT: Do you monitor other service providers in the region? Do you have an estimate or calculation of the market share of the Australia Network in the region? Is it holding its share? Is it declining? Is it gaining?

Mr Tranter : We receive regular reporting from ABC International about the progress of the Australian networks broadcasting in the region. The reporting from the ABC indicates that it is increasing slowly, with a very small market share. There are differences across different markets. As you are probably aware, it operates in 45 countries, through many rebroadcast arrangements through the region. But we do not as a matter of course make systematic assessments of the network against its competitors.

Senator FAWCETT: Are there any other sources of reporting that would give indications of ranking or numbers of viewers, as opposed to ABC self-reporting?

Mr Tranter : We receive reporting through our post network on perceptions and impressions of the service. In some of those markets there is some data available which would quantify the share of the Australia Network in a particular country. But there is no aggregate reporting across the whole of the region which would allow us to make a complete assessment.

Senator FAWCETT: I am happy for you to take this on notice. Could you give us some feedback as to whether, when it comes to downloads from the website for the service, the majority of those downloads are domestic or whether they in fact occur overseas in the region.

Mr Tranter : I can say now that the vast majority are from overseas.

Senator FAWCETT: Mr Varghese, can I go to a separate issue—it is part of 1.2, I think—which is about the rollout of the subclass 600 visitor visa category. I understand that it extended to a further 21 countries for online applications to Australia. Is that correct?

Mr Varghese : I am not across it, and it sounds to me like a question for the Department of Immigration and Border Protection. If it is going to visa issuing and subclasses of visas, that would be an Immigration matter.

Senator FAWCETT: Does DFAT have any involvement in an assessment of which countries will receive clearance? I am looking here particularly at the fact that, in the Middle East, seven countries in that region—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, Turkey and the UAE—were included in that program, but Israel was excluded. I am wondering: does the department have any input into that? Do you have any concerns that a democratic nation which has a very low overstay rate, such as Israel, should have been excluded from that process?

Mr Varghese : I do not know, but perhaps our Ambassador for People Smuggling Issues might be able to help.

Mr Chittick : The department was not consulted and is not normally consulted as part of that process by the Department of Immigration and Border Protection.

Senator RHIANNON: Did the government consult the Palestinian community before making changes to Australia's position on Israeli settlements in occupied Palestinian territories?

Mr Varghese : What change are you referring to?

Senator RHIANNON: The changes with regard to our vote in the United Nations and the statements made by the foreign minister on settlements.

Mr Varghese : I am not aware of any process of consultation, but perhaps Mr Innes-Brown might be able to confirm or otherwise.

Mr Innes-Brown : No, there was no formal consultation.

Senator RHIANNON: When you say 'no formal consultation', do you—

Mr Innes-Brown : No consultation.

Senator RHIANNON: At all?

Mr Innes-Brown : Not that I am aware of.

Senator RHIANNON: Does that mean that you need to take it on notice to confirm?

Mr Innes-Brown : I did not hear all of your question. If you could just repeat the question, that might help, and I can give you a definitive answer, hopefully.

Senator RHIANNON: Did the government consult the Palestinian community before making the changes to Australia's position on Israeli settlements in the occupied Palestinian territories?

Mr Innes-Brown : No.

Senator RHIANNON: The foreign minister was quoted in the paper expressing concern about the mistreatment of Palestinian children. Was this a media statement only, or was it a statement conveyed to the Israeli authorities?

Mr Innes-Brown : It was an issue that we have taken up in Israel, and I took it up earlier this week with the Israeli deputy head of mission.

Senator RHIANNON: 'Taken up in Israel'?

Mr Innes-Brown : By our ambassador and the deputy head of mission, who have had a number of meetings and discussions with the Israeli foreign ministry and also the department of justice.

Senator RHIANNON: What were the issues? Could you give us an overview of the topics that were discussed in the context of the mistreatment of Palestinian children?

Mr Innes-Brown : They went to the general issue of security and judicial practices, raised concerns about those and encouraged further progress in addressing some of the concerns that we had.

Senator RHIANNON: When you say 'encourage progress in terms of the concerns that we have', does that imply that there will be follow-up? And will there be follow-up?

Mr Innes-Brown : It is an issue that has been under scrutiny for some time. It is not the first time we have raised the issue. I am advised that there have been some reforms over the past 12 months on this issue by the Israeli authorities, and obviously it is an issue we will continue to look at.

Senator RHIANNON: Could you inform us what the reforms are? You said that there have been reforms by Israeli authorities?

Mr Innes-Brown : I am not an expert on the subject, but I can give you some examples. For instance, the amount of time that a minor is held before being brought before a judge has come down. There is a suite of measures, but there are a couple of things that I am aware of. Minors now have separate hearings from adults. When a Palestine minor is arrest and Arabic language document that explains the circumstances and the rights is given to the parents. Another measure that is under consideration, it is being trialled, is that they are going to implement a summons system rather than the occasional practice of arresting people at night—going into houses and so on. There are obviously some reforms underway. I do not have complete information on that, but they are just a few examples that I am aware of.

Senator RHIANNON: You spoke of a suite of measures. Did you outline them all then, or do you need to take it on notice so that you can supply the committee?

Mr Innes-Brown : They are some of the ones that I am aware of.

Senator RHIANNON: Can you take it on notice.

Mr Innes-Brown : I listed four or five of them.

Senator RHIANNON: Can you take that on notice?

Mr Innes-Brown : Yes.

Senator RHIANNON: In outlining these reforms, is the suggestion that there has been an improvement in the way Palestinian children are treated by the Israeli authorities?

Mr Innes-Brown : What I said was that there have been some changes to the way they handle these cases. They certainly believe that they are improvements and reforms. There is some international attention to this issue, including by their agencies, and I think the perception is that there has been progress.

Senator RHIANNON: You say that the perception is that there has been progress.

Mr Innes-Brown : That is the view of some people who are involved in the sector.

Senator RHIANNON: Can you expand on that? That is an important statement. When you say 'perception', who are you referring to?

Mr Innes-Brown : Agencies that are involved in these issues in Israel. As an embassy and as a government, we have conversations with people about various issues, and I am not going to divulge the contents of those sensitive conversations.

Senator RHIANNON: You know that I did not ask that question. You said that there is a perception that there has been an improvement, so the next question is: where do you get that perception from?

Mr Innes-Brown : From speaking to various people.

Senator RHIANNON: Are we talking about international—

Mr Innes-Brown : I am not going to go into the details of that.

Senator RHIANNON: You are not going to supply details on whether they are organisations, government authorities or NGOs? You cannot give us any suggestion where you picked that perception up?

Mr Innes-Brown : No, I am not going to go into the details.

Senator FAWCETT: Just to follow up on that issue, I am aware that there has been a lot of consternation in Australia since the program that was broadcast by our national broadcaster. Given that a number of media outlets overseas have actually gone public to correct statements that have been made and to apologise for errors of fact—which were repeated in that broadcast—does it concern DFAT at all that, in terms of our relationship with Israeli, our national broadcaster would have broadcast a program that had errors of fact or, in fact, left out information that would have changed the perception that people had? Do you have any plans to speak to the ABC about them enforcing their own editorial standards?

Mr Varghese : It is not our practice to run a ruler over what the ABC does. Clearly if there are errors of fact in a broadcast we would hope that they would be rectified. But, as a general rule, we do not monitor programs to establish where there are errors of fact or reporting and then take that up with the station.

Senator FAWCETT: Can I take you to a different issue. Referring to the global partnership for education, which has received substantial funding in recent years, could you clarify that the previous government committed $278 million to the fund over the period 2011-14.

Mr McDonald : Yes, I can confirm that.

Senator FAWCETT: Can you confirm that in the same time frame much larger economies like Germany committed only about $21 million and America committed only about $20 million to the fund?

Mr McDonald : I would need to confirm that on notice, but I believe that sounds fair.

Senator FAWCETT: Are you aware of the independent valuation of the Global Partnership for Education?

Mr McDonald : No I am not—independent evaluation?

Senator FAWCETT: There was an independent evaluation done of the program. It had a very mixed report card, in fact there were some fairly negative areas. Despite that, Australia increased its contribution from $38 million to $278 million. On what basis was that significant increase made, given the very mixed report card of the evaluation?

Mr McDonald : I am not aware of the independent evaluation. This replenishment was back in 2011, I think. I am happy to take that on notice and look at it.

Senator FAWCETT: In the light of a mixed report card, replenishment is a bit of an interesting term to use, when it is an order of magnitude larger contribution to the fund. But if you could take that on notice, that would be very useful. I would like to know if the department was aware of the review. If it was aware, was that taken into account before that decision was made? On what basis was that significant increase made?

Mr McDonald : We will take that on notice. I am sure others in the department would have been aware of that. It was just before my time. I am happy to respond.

Senator FAWCETT: I would also be interested to know if the PMO was involved in the decision to make that increase.

Mr McDonald : I will be happy to take all of that on notice.

Senator FAWCETT: Thank you.

Senator KROGER: Chair, can I follow up a question on the same matter?

CHAIR: Yes, but I do want to make an announcement at this point. That is that we have finished the individual countries and we are now proceeding into the aid program and aid overview.

Senator KROGER: That's fine, because the question that the senator just asked actually covers aid so it is a good segue into the section on aid. I follow up on Senator Fawcett's question. Firstly, the 2009 Independent Review of Aid Effectiveness had some 39 recommendations. Are you aware of that review?

Mr McDonald : Yes.

Senator KROGER: One of those recommendations was ensuring the integrity and analysis, if you like, of the multilateral organisations that we partner with for the divestment of aid, to ensure that aid is divested and delivered using best practice. Are you aware of the general tenet behind that recommendation?

Mr McDonald : Yes, I am.

Senator KROGER: Are you aware of the independent review that was undertaken in 2012 into all multilateral organisations of which the then AusAID agency was engaged with?

Mr McDonald : Yes, I am aware of that independent—

Senator KROGER: Okay.

Mr McDonald : There was an Australian multilateral assessment undertaken and the multilateral agencies were put in categories. The agency that we have just talked about, the Global Partnership for Education, was a tier 1 organisation, so it was rated as our highest, one of our highest multilateral partners in that assessment. That was done in 2012.

Senator KROGER: You are aware of that review of 2012, so you can say that. In the review of the Global Partnership for Education organisation, a number of concerns were raised about the determination of the way in which money was invested and whether they were divested with best outcome practices. Are you aware that there were concerns raised in that review?

Mr McDonald : I just want to clarify whether we are talking about the Global Partnership for Education or the Global Fund.

Senator KROGER: We are talking about the Global Partnership for Education.

Mr McDonald : In the Australian assessment in 2012 on the Global Partnership for Education, that organisation was rated very strong or strong on six of the seven indicators. The indicator that it was ranked weaker on was against one subcategory which was around monitoring and evaluation of data. That is my recollection. I can check that on notice, but that is my understanding.

Senator KROGER: Could you come back to us with more details in relation to the issues that were raised, highlighting concerns about monitoring and evaluation? Clearly, evaluation is a big part of any review in relation to the effectiveness of any organisation or in the divestment of aid and, therefore, how they rate in terms of outcomes. Following on from Senator Fawcett again, of the top 19 countries that support and have given funds to the Global Partnership for Education, Australia was up there ranking No. 2 in terms of the significance of the funding to that organisation. No. 1 was the United Kingdom. They declined their contribution from when they first started, in the period 2004 to 2010, to the period 2011 to 2014. Their contribution was dropped, and yet Australia's contribution went from $38 million between 2004 to 2010 to an absolutely staggering $278 million in 2011 to 2014. I have to point out that the USA donated funds to the tune of $22 million in the same period. So we have determined to increase our share of the pie so significantly that we are the No. 2 player in funding this organisation. Not only that; we are only one of maybe four nations, and certainly of that top 19 or 20, that has made a determination not to decrease it. All the others decreased their funding to this fund. Can you advise the committee on who made the decision within the department, or whether it was the minister? Who made that pretty significant decision to increase our funding support from $38 million to $278 million?

Mr McDonald : I am happy to take that on notice. It would have made by the government.

Senator KROGER: When you say 'made by the government', it would have been a ministerial decision that the funding allocation be increased by—it is not tenfold but, if I could work it out maths wise, it would be eightfold, or something like that.

Mr McDonald : In terms of the increase, as I said earlier, I would need to check what that is. You said it was $38 million. I just want to check that figure. The second bit is that the decision would have been—

Senator KROGER: Increased to $278 million. It started at $38 million.

Mr McDonald : I agree with last figure, because I know what that figure is—the $278 million. I also agree that we are the second highest donor in that regard. In terms of who made the decision, I would have to go back and check.

Senator KROGER: With these sorts of decisions—and you said it would be a government decision—would it be reasonable to suggest that it would have to be either the Foreign Minister or the Prime Minister? They are the only two people who would preside over such a determination, wouldn't they?

Mr McDonald : As I said, I would like to check who made that decision. I would expect it would have been the Foreign Minister. I would need to check and I think it is important that I do check.

Senator KROGER: There are many who call me more than a little sceptical on some things, but I do find it a remarkable coincidence that we have a staggering increase when there are so many constraints on all budgets—and in particular the aid budget—and we are trying to make sure that we support countries that are under significant challenge in all sorts of ways. So I find it extraordinary that there was such an exponential increase in one particular fund and then former Prime Minister Gillard was appointed to head up and chair this immediately after—literally months after—her leaving parliament.

Senator DASTYARI: That is a pretty serious allegation.

Senator KROGER: It certainly is. I am hearing here no justification for why a budget was increased from $38 million to $278 million. That is a lot of money in anybody's terms. I can tell you, it is a lot of money in my terms!

Senator DASTYARI: It was increased because it was a policy priority for the government at the time. It was a budget decision for the government, and it went through the proper government processes.

Senator KROGER: I take your point, because it goes to the heart of what is a policy priority, when clearly this was a government decision by a minister.

Senator DASTYARI: We believe that education is a policy priority for the government. Do you not believe that education should be a policy priority for the government when it comes to aid? I do.

Senator KROGER: I have never derided that.

Senator DASTYARI: What are you deriding? You are making a serious allegation about a former Prime Minister.

CHAIR: Let's come back to the fact that Senator Kroger has the floor. We do not want interruptions from you, Senator Dastyari. Let the senator finish what she is saying.

Senator KROGER: I would like to take that interjection, because this does go to the heart of the motivations and the determinations of policy decisions of the former government. This decision was made very recently in the scheme of things, under the former Gillard government. Can you come back to me and advise me who specifically made that decision, on what basis it was justified, how it compares across the board to other increases in aid spent in other gender and education areas. I look forward to seeing that response.

Mr McDonald : I am happy to take that on notice. When the government released its effective aid policy in 2011, following the review that you referred to, education was the flagship of that policy, and, as I said earlier, this was a tier 1 organisation as well. But I am happy to take on notice all those questions, including who made the decision.

Senator KROGER: There are many regions where we divest money that is an increase in spend to increase literacy and numeraly and so on. A great example I am thinking of is the support of schools in Indonesia that is clearly targeting education. If you could do a comparative analysis for me on that, that would be very helpful.

Mr McDonald : Just on that, the Global Partnership for Education does work at getting children, including girls, into school. It also emphasises training the teachers in education. They are two of its core focuses.

Senator KROGER: Thank you.

Senator DASTYARI: I will ask a few questions. But before I move on to the questions I have, is it fair to say that the fund we are referring to, the Global Partnership for Education, is an internationally recognised aid organisation that does work in the space of education, particularly for those who are underprivileged?

Mr McDonald : From recollection, it works in 50-odd countries in the world.

Senator DASTYARI: Is it uncommon for governments, from time to time, when they prioritise a policy area—be it education for others or other areas—to make sure that their aid approach is focused on those areas?

Mr McDonald : In terms of government priorities, they are reflected in the allocation of the budget.

Senator DASTYARI: In your or Mr Varghese's opinion at the time, was there anything improper in any way, shape or form about the allocation of the budget to the Global Partnership for Education?

Mr McDonald : I would like to take that on notice, because this replenishment was in 2011. I commenced in AusAID in 2011, so I am not sure I was even here. But I would add that in my experience decisions made on matters such as this replenishment are through appropriate government processes.

Senator DASTYARI: Thank you. I just want to get back to the broader issue now. I know we had a conversation last Friday. I do not want to revisit everything we said on Friday; there is a Hansard record that we can all go to. But I will go to the heart of it. There was $650 million of cuts announced on 18 January this year; is that correct? Sorry, we had a debate about the language. The language we agreed on last Friday was that there was a revised budget update which was $650 million less than had been indicated in the 2013-14 budget. I think that was the language we agreed on last Friday after about 20 minutes of debate. Is that right?

Mr McDonald : That is correct.

Senator DASTYARI: Mr Varghese, you were going to get some information on notice for me and Senator Rhiannon, who is not here, on what information was available below the headline figures as to what programs had been identified, effectively, to be cut to meet the new budget allocation, and you came earlier today and said that there was no information available.

Mr Varghese : That is right. That process is continuing, so we are not in a position to provide you with any further detail.

Senator DASTYARI: This is my issue with that, Mr Varghese. There is four months to go. There is $650 million. I am not expecting or asking you to give me every figure of every cut of every organisation, but are you telling me that at this point in time the Department of Foreign Affairs and Trade has no idea of where any dollar of that $650 million is going to come from?

Mr Varghese : We know which country programs are going to be reduced by which amounts and which multilateral funds are going to be reduced by which amount. That has been published.

Senator DASTYARI: But surely on the country level, by this point in time, some of the cuts have been identified.

Mr Varghese : We are in a dialogue with the partner countries about how the dollar amount that is going to be taken off the budget will translate into changes in the programs, and that is the discussion we are having.

Senator DASTYARI: Is your evidence to us today that, out of the 46 or so countries and all the different aid organisations that we support, there is not one for which you have completed a process whereby you can identify where those cuts are going to be from?

Mr Varghese : My understanding is that we have not completed a process in any of those countries.

Senator DASTYARI: In any of those countries?

Mr Varghese : In any of those countries. Take Grenada, which is a completely different kind of example, because we did not have a bilateral aid program to Grenada; we had this one project running. We cut the budget for Latin America. It was a no-brainer as to where the cut would fall.

Senator DASTYARI: But then why couldn't you provide us with that information?

Mr Varghese : On Grenada?

Senator DASTYARI: Yes.

Mr Varghese : I think it was out in the public record.

Senator DASTYARI: Sure, but my point—

Mr Varghese : But that was sort of an exception to the point I am making, which is that you need to go through this process of consultation with your partner countries in order to come to an agreed position on how you are going to translate the cuts into projects.

Senator DASTYARI: Was the decision for the cuts a bilateral or a unilateral decision?

Mr Varghese : A unilateral decision.

Senator DASTYARI: So the decisions have been made, so we know for a fact—again, I am just using this is an example; we can use different examples—that in Cambodia there is what I call a $7.9 million cut; you can call it a reduction between the planned expenditure at budget time and the coalition's adjusted figure on 18 January. Forget about the language, because that is insignificant. You are telling me that in none of those cases, with four months to go to the end of this financial year, are you in a position to give detailed information, and that none of the cuts within that $7.9 million has been identified or translated to the government of Cambodia.

Mr Varghese : Until you have an agreement which accounts for all of the cuts, you do not have an agreement.

Senator DASTYARI: But you seem to have no agreements with anyone.

Mr Varghese : That is what I am saying: it takes time.

Senator DASTYARI: So you have none; none of the agreements is done.

Mr Varghese : None of the agreements is concluded. It does take time. As I pointed out this morning, if you go back and look at what happened the last time we went through this process, under the previous government, there was a gap of 67 days between when the dollar amount was announced and when we could announce what particular projects and programs were going to be affected.

Senator DASTYARI: It defies belief. Some of those questions on notice were not exactly difficult. Decisions were made on a country-by-country allocation. What I do not understand—and this was asked on notice—is: this was not an efficiency style dividend, but to me these numbers do not make sense. Obviously, there was a process and criteria were applied. The question on notice was: what were the criteria used to get the cuts to $650 million?

Mr Varghese : I think I did actually go through some of the criteria when we met on Friday, but let me reiterate some of them. The first principles that we brought to this exercise were: firstly, we wanted to refocus the geographic footprint of the aid program so that the Indo-Pacific was the primary focus and that subsequently led to reductions in the budget for Latin America and Africa. Secondly, we had in mind the effectiveness of multilateral organisations. So, in making decisions on where to make cuts in the multilateral pot, we took into account our judgement about the effectiveness of multilateral organisations. Mr McDonald indicated that we do have an evaluation process that puts these multilateral organisations into different tiers. Thirdly, we wanted to reduce both geographic and sectoral fragmentation, so we wanted a program that was not overly fragmented.

They are the core principles that framed the budget decisions that were taken. As a result of that, if you look at the revised figures for 2013-14, we have a larger percentage of the budget going to East Asia than we did before the cuts.

Senator DASTYARI: But you still have cut from East Asia. Is that correct?

Mr Varghese : We had cuts across the board.

Senator DASTYARI: But East Asia got a $116 million cut. Is that correct?

Mr Varghese : Yes, but that represents 41 per cent of the total aid budget, compared to 37 per cent in 2012-13.

Senator DASTYARI: But it still represents over 20 per cent of the cut.

Mr Varghese : It does, because this is an exercise in how do you arrive at a number that is $650 million less than where you started.

Senator DASTYARI: I have two questions on that. This is why we were asking detailed questions and why you were going to take it away on notice.

Mr Varghese : Senator, can I just say that when I said I would take it away on notice, I did say to you that I did not expect that by today we would be in a position to give you any more detail than I was able to give you on Friday.

Senator DASTYARI: Some of those questions are quite black and white, but they are on notice. I want to clarify the difference between what was planned for the budget and the adjusted figures for 18 January—which I refer to as cuts. Did the decisions that were made on a country-by-country basis consider what programs were already in place in those countries beyond the overall allocation to those countries and where was the status of spending in those countries at?

Mr Varghese : The decision was taken without assuming cuts in particular programs. You have, let's say, the Indonesia country program—

Senator DASTYARI: Where we cut $59.1 million.

Mr Varghese : You make decisions about how you are going to distribute your $650 million of cuts. I have given you the three core principles that we used in arriving at those decisions, and now we are in the position where we have to work out what that quantum of cut in each individual country program is going to mean for the particular projects that we have budgeted for in the aid program. As I keep saying, this is exactly the process we went through the last time this happened.

Senator DASTYARI: If I am applying the criteria that you indicated—the Indo-Pacific, effectiveness of multilateral, geographic, sectional and the other—it is not as if you have gone region and by region and taken a percentage. It is not as if you sat down and said, 'Right. We're cutting 20 per cent from Asia and 60 per cent from everywhere else. The numbers and figures themselves strike me as quite arbitrary. The fact that you chose to cut 10 per cent of Indonesia and yet 20 per cent of Vietnam—these are kind of rough figures—I do not understand the application of those principles. And then what you are telling us today is that there was not a decision where you sat down around a whiteboard or a table and said, 'Right. These are the programs that we are funding in Vietnam. This is how much money has already been spent.' You are doing this halfway through the year, so obviously some of the money has already been spent.

Let me phrase a different question. When you were making these decisions, were you doing it within the context of what had already been spent at that point in time and what money was or was not recoverable?

Mr Varghese : We certainly would have taken into account how much money had been spent up to that point.

Senator DASTYARI: You did. Okay, that makes sense. So is it fair to say it was a process that began at the end of last year and finalised at the start of this year? Is that a fair time frame to place this under?

Mr Varghese : Sure.

Senator DASTYARI: While going through that process you sat down and said, 'Right. At a country by country level, this is how much has been spent and this is how much is left, and we are trying to get to a goal of $650 million.' Is that correct?

Mr Varghese : That is roughly correct.

Senator DASTYARI: Okay. When you were looking at what had not been spent and what was left, did you do that with a regard to what the actual programs were that were left?

Mr Varghese : We did not go down to that level of detail. We did not go down to that level of detail last time round and we have not this time.

Senator FAULKNER: Could I ask, in terms of process—and excuse my ignorance on this: when such matters are in the planning stage, and you are saying that they effectively are at the moment, or perhaps beyond the planning stage but at least in the planning stage—is there communication between DFAT and, on the one hand, either country recipients or NGO or agency recipients on the ground about prospective cuts? I appreciate that we are working here on a financial year time frame. I appreciate that. But I am coming to the point that I think Senator Dastyari is exploring. I am interested in knowing whether effectively in this work that DFAT is engaged in and involved in as we speak—which you have indicated to us—whether there is any understanding of that in terms of the recipients of Australian aid.

Mr Varghese : Our dialogue with the recipient countries commenced after a decision had been taken about the quantum of cuts. Senator Dastyari asked me this earlier: was it a unilateral decision or not, and I said it was a unilateral decision. Once that decision was made, we asked our heads of mission to advise the recipient governments and to begin the process of identifying what is the best way of implementing those cuts. You can defer a project, you can trim a project down, you can drop it completely—there are all sorts of ways in which you can manage the budget reduction.

Senator FAULKNER: I appreciate that. I am just trying to get an insight into the questioning here, how much this is a responsibility of the recipient government and how much this is a responsibility of DFAT here in Australia. That is really what I am trying to understand. I do not pretend I precisely do, hence I am asking about it. That element is still what is not clear to me. I do not know whether you can assist me with that or not.

Mr Varghese : We would like the decisions on how we are going to manage this reduction to be agreed between us and the recipient country, because ultimately these are partnership arrangements and we want to treat them as partnership arrangements.

Senator FAULKNER: Understanding that, does that mean that impact on individual projects and programs and what might happen with them at this stage is something that is being dealt with exclusively by the recipient country authorities?

Mr Varghese : Not exclusively, because it is a dialogue we are having with them.

Senator FAULKNER: You say a dialogue with the recipient country. I am trying to understand whether that goes beyond formal government to government or agent department to equivalent agency.

Mr Varghese : It is a government to government dialogue.

Senator FAULKNER: Yes, it is a government to government dialogue. I am still grappling with how that goes beyond a government to government dialogue to individual programs. I have assumed that it was the recipient government and its agencies that deal with the individual projects and programs, but you said not necessarily. Let me ask the question this way: are you dealing exclusively with the recipient governments or are there some cases when DFAT goes beyond that and deals with perhaps agencies or NGOs or other groups actually the recipients of aid? Have I made myself clear?

Mr Varghese : I understand the question. Maybe I could ask Mr McDonald to add to it.

Mr McDonald : If I can try and talk about the process we use in any budget process with partner countries, we sit down and agree those priorities with them. Secondly, there are other partners—multilateral partners are a good example—where we need to consult with them about the adjustments in the budget. Of course that is occurring. So we are talking with those partners that we can talk with directly and we are talking with the partner countries around the priorities within their country program. We need to agree those, and I think it is fair to say that this is the second occasion we have done this and that the partner countries appreciate the fact that we do consult with them to get that agreement and that as part of that they are quite understanding in relation to what we are doing.

Senator FAULKNER: I think I understand what you are saying is that, if you like, at one level there are recipient or partner countries and multilateral partners. That is at one level. I am asking beyond that, whether there is also negotiation or communication or discussion beyond that level, or below that level would be a better way of describing it, with individual aid recipients, non-partner countries, non-multilateral partners but, for want of a better description, the agencies or groups which are delivering the aid on the ground. I hope that generalisation is adequate in DFAT-speak.

Mr McDonald : Yes, it is, Senator. In terms of that, yes, of course there is a flow-on once those priorities are agreed and we have those discussions with those partners.

Senator FAULKNER: That means the priorities are agreed. We are not at that yet. This is what I am grappling with. We have heard that the priorities have not been finalised and agreed. So in the agreement process or in finalising the decisions that are being made internally in the agency, the thing I am trying to understand is whether you are going beyond the recipient countries and the multilateral partners at the top level and dealing also with other agencies, groups, NGOs and delivery mechanisms at what I describe as the coalface.

Mr McDonald : I think the reason I said that the agreement needs to be made at a country level first is that you do not know the impact until you have had that discussion. If I can give you an example from 2012, around 60 per cent of the reductions in the program were through deferral of payments—so there were actual deferrals, they were not cuts. When you go through those discussions, you can decide what actually needs to happen in the program. Once that occurred in 2012, as Mr Varghese was mentioning, those details were put out into the public on our website, and that took about two and a half months to do.

Senator WONG: If I may, Senator Faulkner, could I follow up on that point? There is no suggestion from DFAT—and I apologise that I was not able to attend earlier when this was being discussed this morning—that deferrals will be sufficient to meet the quantum of cuts which have been imposed, is there? You will need to go beyond deferral in particular areas, countries or organisations in order to meet the objectives, particularly for 2013-14 year.

Mr McDonald : I would expect that to be the case.

Senator WONG: So it is a very different process?

Mr McDonald : No, it is not different. It is exactly the same.

Senator WONG: I have got a range of questions, so I will go back to Senator Faulkner.

Senator FAULKNER: I have only got one, and I am going to give up here, because in this business you have got to quit when you are behind. I still do not get whether you are discussing, negotiating or contacting—where the negotiation process is up to at the moment as it is developing or evolving—or whether it involves groups below—and I use the term 'below', because it is not recipient countries or multilateral partners, but those that are responsible for delivering projects or programs on the ground. Are they engaged in the process? That is all I am asking. I still do not know.

Mr McDonald : Yes, they would be.

CHAIR: I would like to ask whether people who are here for Outcome 2, Program 2.1, Program 2.2, Outcome 3, Program 3.1 and Program 3.2 are needed. I do not think they are. We are planning to go onto trade, so I think those people can leave this meeting.

Senator WONG: I am not as experienced in this committee as others, but the proposition is essentially that we will continue with aid until the dinner break and then thereafter the trade portfolio.

CHAIR: Yes, it is.

Senator WONG: It is alright with me. I know you wanted to go to Senator Fawcett, but I just had a few questions on this issue and then I am happy to leave it for a short bit.

CHAIR: I did tell Senator Fawcett I would give him the call.

Mr Varghese : Sorry to interrupt. I just wondered, for the sake of my colleagues who are still here, can I take it that anyone other than those dealing with aid and trade after dinner can be excused?

CHAIR: That is the situation, Mr Varghese.

Senator WONG: I would like to come back to this after Senator Fawcett—and you might have covered it this morning—but can you just remind me of the various categories of funds in relation to each area, country or organisation within the aid budget? I assume there are funds that you would describe as contracted. I am trying to get your nomenclature—is that correct?

Mr McDonald : We do engage contractors.

Senator WONG: No, it is a budgeting question. If you look at your aid budget—you are nodding so maybe you can assist—I assume there is a quantum of funds which might be legally contracted. Correct? So you have whatever your legal arrangements are—I will call it a funding agreement for this purpose. Then you have committed where you might have had an announcement—you might have had at official or political level an agreement that this would be funded, but as yet it has not proceeded to implementation. Then you might have funds which are not yet committed or contracted. I am interested in understanding those categories and how—I assume you are able to give me that information.

Mr Wood : Correct. As you say, the aid program and the allocations by country are split into those categories. Obviously at this stage of the year there are contracts that have been fully paid out; there are other contracts that are underway where there might be a binding commitment to make a payment and there would be a further group of categories where activities would be yet to commence.

Senator WONG: What is the nomenclature you use? Within DFAT, what do you describe each of those categories as?

Mr Wood : We would refer to contracts; we would refer to expenditure and we would refer to commitments. Potentially there might be another category of unallocated or uncommitted funding.

Senator WONG: But I think we have agreed that the quantum of unallocated funds, given that the deferral process in 2012-13 is probably—would it be correct to say—is exhausted for a substantial component of the aid budget in 2013-14.

Mr McDonald : No, I did not say that. I said that in the last reprioritisation, 60 per cent of the reduction was achieved through deferrals. There is also the opportunity through this process to defer payments again. I don't know what that percentage is, because we haven't completed it, but there will be deferrals, yes.

Senator WONG: I would therefore assume that in relation to each country or regional program you would at least know what funds are in each of the four categories you have just given me.

Mr Wood : We will know what has been spent and we would have an idea of what is committed, but as we mentioned it is a complex large program and just as an example—

Senator WONG: No, sorry, I am not asking for details on a particular country, yet. I am saying that, for the purposes of your budgeting, you must have some understanding and you must have some record somewhere in DFAT—you are managing a very large budget in terms of aid—of what falls into contracted, what has been expended, what is committed, which is, as I understand it, one step back from the contractor process, and what is technically unallocated.

Mr Wood : We obviously definitely know what has been expended because as you know we report that each month—

Senator WONG: Correct.

Mr Wood : so we know the expenditure by country.

Senator WONG: Finance is always aware of what has been contracted because that is a basis on which deferral discussions are made. So maybe we can go to Senator Fawcett, as the chair has requested—thank you for the courtesy Senator Fawcett—and perhaps when we come back someone who actually runs the budget within DFAT could be in a position to tell me what is in each of those categories.

Senator FAWCETT: Can I assume that, as a competent public service organisation, DFAT sees itself as a learning organisation, that after you have gone through a cycle once you develop processes and that you learn and get better at what you do?

Mr Varghese : I would hope so.

Senator FAWCETT: Is it not the fact, in fact I believe that you stated before, that the process you are currently engaged in you were actually engaged in not that long ago. It was called a deferral or re-prioritisation, but the amount was still $5.7 billion and so you had to go through essentially the same process that you are going through now. Can you confirm that that is the case?

Mr Varghese : In the broad, I think it is the case. It is a similar process that we are going through now.

Senator FAWCETT: Under the former government there was a cut, a deferral, a reprioritisation—whatever word you want to use—and you went through a process. You have now learned from that process. Is it a reasonable assumption to say that, having learned from that, you are actually doing at least as good a job, if not a better job, this time in working through the engagement with multilateral partners and other countries and in working out the best and most effective way to minimise the impact on stakeholders and optimise the use of taxpayers' money?

Mr Varghese : I would have to defer to colleagues about how much we have learned, because I was not involved in this process the last time around. It was handled within AusAID, which was then an executive agency, so I did not have any responsibility for it.

Mr McDonald : The process is effectively the same in the sense that the consultation that we undertook to arrive at how the reductions would be implemented was done in a partnership way through discussion; that is happening again with partner countries. That process is the right process to use. It is how we do all our budgets with our partner countries; we sit down and agree to those priorities. It is also important that you get shared agreement on whether programs or payments can be deferred, for example. So, yes, we are using a very similar process to that used in 2012.

Senator FAWCETT: Would it be a fair assumption that this absorbs a fair bit of the effort within the department, that when a change occurs and is directed by government there is a fair bit of manpower going into making sure it works well?

Mr McDonald : Yes, there is.

Senator FAWCETT: Can I ask you to confirm then that this government, before the election, made one announcement? In the 15 months before the election, how many times did the former government cut the aid budget?

Mr McDonald : I will defer to Mr Wood on that. There were several adjustments to the budget, which from memory added up to a $5.7 billion adjustment to what was in the forward estimates. I will ask Mr Wood to confirm that.

Mr Wood : In the last couple of budgets there were reductions and, as you would know from the submission that the Treasury provided to the Friday Senate hearing, there was a section on recent government decisions in ODA, and that referred to some of those recent savings reductions. In 2012-13 there was a $2.9 billion saving; there was a further $1.9 billion in the 2013-14 budget; and $0.9 billion was announced in the 2013 economic statement.

Senator FAWCETT: My point is that there is a process underway. Governments of both persuasions have seen fit to reprioritise—whatever word you want to use. But the current government has done it once. You have a clear direction; it was announced before the election. But the inefficiencies of multiple announcements would have had a far greater impact upon the resources of the department. Is that a fair statement?

Mr Varghese : We covered this on Friday in a separate hearing. I think budget certainty is very important to those who are managing the program. So the more certainty we can have on numbers, the easier it is to manage the program. And obviously the obverse is true: the more frequent the changes to the numbers, the more difficult it is to manage.

Senator FAWCETT: The point I am trying to get on the record is that we have just had a half an hour of discussion criticising the process you are going through, when the evidence just provided is that the process is at least as good, if not better, than applied under the previous government. But this time, prior to the election, you have had warning that it is coming, as opposed to three impositions of changes, which makes the department dreadfully inefficient. I think there are other things we could be moving on to as opposed to pursuing this, when both sides, for very good reasons, have made decisions and the process is remarkably identical.

Senator WONG: Mr Varghese, you might have covered this today, but is the date by which the 0.5 per cent GNI target is met still undetermined?

Mr Varghese : I do not think the government has put a date on getting to 0.5.

Senator WONG: So you were not consulted in the assumption in MYEFO which assumes the former government's target of 2017-18?

Mr Varghese : The former government's target was a statement of fact.

Senator WONG: No—the MYEFO figures assume that this government will achieve the GNI target by 2017-18. Were you consulted on that fact?

Mr Varghese : To the best of my knowledge, no.

Mr Wood : No, Senator.

Senator WONG: So that is just an assumption the central agencies have made. Are you working to that policy position, that 0.5 per cent GNI will be reached by 2017-18?

Mr Varghese : No. We have not been given a time target.

Senator WONG: Can we go back to the four categories, Mr Wood. Contracted, expended, committed and unallocated—are we in agreement?

Mr Wood : Yes.

Senator WONG: I presume you disaggregate that down to particular countries—correct?

Mr Wood : We do. I do not have that information with me.

Senator WONG: I thought you would say that.

Mr Wood : We do not have those reports, but that information is available and that is part of our reporting that you would be familiar with.

Senator WONG: Sure. Do you have information here—does one refer to them as regions, specific total East Asia, South and West Asia, et cetera?

Mr Wood : Correct and also for our recording we break that down by the major countries, similar to the tables you would have seen in the reprioritisation.

Senator WONG: Okay. Do you have those four categories at the regional level?

Mr Wood : I do not have that information.

Senator WONG: What do you have here? Do you have anyone here who knows any of this?

Mr Wood : We would not have anybody here who has information on our year-to-date spend and year-to-date commitments. Obviously we have that information on our systems but I do not have that information with me.

Senator WONG: It cannot be very hard to extract it at the regional level.

Mr Wood : Correct, Senator, but obviously I do not have access to our ledgers at the moment. Could I say off the top of my head that I think our year-to-date expenditure was over 40 per cent of our budget—perhaps 42 per cent.

Senator WONG: So 40 per cent of the 2013-14 allocated budget?

Mr Wood : Correct. That is the only information I could provide on our year-to-date.

Senator WONG: That is 40 per cent expended. Are you able to recall what proportion was unallocated broadly post the exercise referred to earlier of the deferrals?

Mr Wood : Not to a precise level. We do have a reserve that is held available for humanitarian emergencies, which Mr McDonald referred to as the mandated flexibility reserve. Obviously that is in a sense purely unallocated because we have not spent that, committed it or contracted it out.

Senator WONG: That would be in the CR contingency reserve as a line item. You would not have allocated that to any of these particular regions, would you?

Mr Wood : That would be sitting within the humanitarian program. This is our internal—

Senator WONG: Yes. At this stage I am only asking about the regions. I have not gone to the global programs.

Mr Wood : Correct, Senator.

Senator WONG: The humanitarian reserve is not applicable in the context of how you track that expenditure.

Mr Wood : Not by region, but it is included in the table that breaks down that program.

Senator WONG: That is fair enough—I accept that. So 40 per cent expended: when you gave me that evidence, was that for the entirety of the program or the country and regional programs?

Mr Wood : That is the entire program. Obviously within countries and regions expenditure occurs at different rates. We have certain categories where expenditure occurs at the start of the year. We have other types of payments, particularly our multilaterals where expenditure might occur on a calendar year basis, and within programs there is a varying tempo in terms of our payments and activity.

Senator WONG: Are you able to recall what proportion is in the unallocated—

Mr Wood : Not a total level. That is the only one I can recall. Obviously within those country programs, within those categories, there may be things that have not been committed or commenced, but I do not have that information.

Senator WONG: Right. But you can provide that?

Mr Wood : We will be able to provide that. I am not sure if we can within the next hour or so, but obviously there is information that is available within the department.

Senator WONG: Within the system. Is it correct to say—and I appreciate you are working from memory—that there would be regions and/or countries where there would be no more unallocated component?

Mr Wood : I would not be able to say, no. In a sense—

Senator WONG: For the 2013-14 year, sorry. It is not a forward estimates question but a 2013-14 year question.

Mr Wood : Sure. I would imagine that, across the program, there would be a very high level of—using a different term—committed expenditure. We would have commitments in place or agreements in place, but again I could not tell you precisely by program and a complete breakdown.

Senator WONG: You have raised committed expenditure, and I am using sort of a lawyer's approach to it—and that may not be how you budget it. So, in my head, 'committed' means, 'We've said we're going to do it but we're actually not legally bound as yet.' Is that how your financial management system for this is set up or is there a different set of criteria for those categories?

Mr Wood : In terms of category, to use a bit of finance terminology you would be familiar with, we would have an FMA regulation 9 signed, so there would be some agreement.

Senator WONG: Now I am confused. You have got a reg. 9 because you have entered into an arrangement—I am trying to use a non—

Mr Wood : A spending proposal, Senator.

Senator WONG: Right. What is the distinction between 'committed' and 'contracted', then?

Mr Wood : Well, for example, you could sign an FMA reg. 9 spending proposal to enter into an agreement, then there could be the negotiating process and then a contract could be signed. To use some other jargon, that would then be done under section 44 of the FMAA—a section 44 agreement.

Senator WONG: Okay. Now that makes sense to me. And that would be how you would track it?

Mr Wood : That is how we track it.

Senator WONG: So, broadly, where there is a legal obligation to pay and you attract the operation of section 44, which presumably means you have some written contract, that is what you would call 'contracted'?

Mr Wood : Correct.

Senator WONG: 'Committed' is where you get the FMA reg. 9 approval to engage in, essentially, the offer.

Mr Wood : Correct. I just note as well that, as stated in the last AusAID annual report, we had in total 1,379 procurement agreements in place at 30 June 2013.

Senator WONG: Can you give me that number again?

Mr Wood : 1,379. It is reported in our annual report. Obviously, it is a fairly complex beast, so this work does require quite a bit of effort.

Senator FAULKNER: And these are, in fact, at the delivery agency level, one assumes, these agreements; are they? NGOs—for individual projects, programs and the like.

Mr Wood : In a lot of cases, that is the high level. I am not the expert on this matter but it is a big number and so it caught my attention. But it could well relate to a lot of those types of activities.

Senator WONG: Which is the big number that caught your attention, Mr Wood?

Mr Wood : Just the fact that we have so many procurement agreements.

Senator WONG: Right. I think you said earlier that you anticipated there would be a large number of funds committed for the 2013-14 year, which intuitively makes sense.

Mr Wood : Correct, yes.

Senator WONG: Why do you think there would be?

Mr Wood : Again, it varies. I would not like to commit a precise figure. It might be about 70 or 80 per cent.

Senator WONG: About 70 or 80 per cent. Are we talking of the total budget or of the allocated budget? I am trying to work out: does that include unallocated?

Mr Wood : Yes. I am only talking about the total budget.

Senator WONG: You are talking about the total budget. So it is 70 or 80 per cent of the total budget. Then, of the 20 or 30 per cent that you have estimated—and I accept it is approximated—some component of that will be contracted and some component would be unallocated. Am I understanding—

Mr Wood : Could you just repeat that, Senator?

Senator WONG: Are we agreed on the denominator or not!

Mr Wood : If we take some broad numbers, 40 per cent of the total budget might be expended.

Senator WONG: Yes.

Mr Wood : Eighty per cent of the budget is committed, so that includes the amount that is expended, sorry. And there might be another amount that is yet to be contracted.

Senator FAULKNER: We are using different definitions. It was contracted, expended and committed, but 'committed' now, in your latest terminology, as I hear what you are saying, is contracted and expended.

Senator WONG: You are using a catch-all.

Senator FAULKNER: Your original three categories have now been changed into two new categories with different nomenclature that unfortunately is the same as some of the previous nomenclature, which is in a different part. So, really, the 80 per cent is if it is contracted, expended and committed expenditure—your first three categories—and eighty per cent is contracted and expended. Is that right?

Mr Wood : Almost, Senator.

Senator FAULKNER: But we have to get the same terminology. Someone reading the Hansard will think we have all gone mad.

Senator WONG: They would possibly think that anyway.

Mr Wood : It would be 80 per cent committed and expended. We talk about a proportion that is committed, and of that, a certain amount has been spent.

Senator FAULKNER: What are we calling the other 20 per cent? What is the new terminology for that?

Senator WONG: That is the unallocated amount.

Mr Wood : It could be unallocated or in the process of doing—

Senator FAULKNER: That is fine. That is good language.

Senator WONG: Sorry, now I am confused. I thought I understood.

Senator FAULKNER: I am with it now.

Senator WONG: Where does 'contracted' fit? Where is the section 44 expenditure in our new architecture?

Mr Wood : That would be a subset of the committed total. For financial purposes we do not track that. We talk about we have committed, obviously because that has the budget tree implication, and what we have expended, but I do not have that figure.

Senator WONG: Okay. I would rather talk to you about how you track the expenditure, because we can ask other parts of the department about how they manage it. But, in order to understand how you track it, that is very useful. So your system essentially looks at 'committed', which includes expended—like actually paid. Is that correct?

Mr Wood : Yes.

Senator WONG: Contracted, and FMA Reg 9 proposals, which may not yet have achieved a legal contract. Is that right?

Mr Wood : Yes, Senator.

Senator WONG: Does the system differentiate between those three categories? Can you interrogate it? Do you habitually interrogate it for that?

Mr Wood : We do track the committed amounts and we do track actual expenditure.

Senator WONG: That would suggest you do not generally track the progress between FMA Reg 9 proposal to contract, because it is all within the 'committed' group.

Mr Wood : I think within our system we do.

Senator WONG: So you could get that as well?

Mr Wood : We do.

Senator WONG: But for the purposes of your budgeting, you say: 'Here's the expended; here's the committed, and then there is the unallocated'?

Mr Wood : Yet to be entered into—

Senator WONG: And that is why the evidence you gave is that 80 per cent is committed, which includes expended, contracted and FMA Reg 9—correct?

Mr Wood : Correct.

Senator FAULKNER: Everything except 'unallocated'. That is how I have interpreted your evidence. Is that right?

Mr Wood : Pretty much—yes. Obviously, that 20 per cent might be identified for—

Senator FAULKNER: You realise the risk, don't you, that the committee will be added to the 'committed' section?

Senator WONG: That is very helpful, thank you!

Mr Wood : It is not purely an allocation and that we do not know how to spend it. It is funding that is maybe going through processes around agreements et cetera.

Senator WONG: And the 80-20 split that you have described—now that we understand what the foundation of that was—is broadly applicable across all of the regional programs and the global programs?

Mr Wood : No. In some cases—for example, the World Food Programme—that payment was made towards the start of the financial year, so that was 100 per cent expensed. Hence, in the table that was published for the reprioritisation, there was no change in the budgeted and expensed amount. I think some of the other payments had occurred earlier in the financial year. As I mentioned, within regions, different activities can occur at different times, so it is not consistent across the program.

Senator WONG: So you are giving me an aggregate?

Mr Wood : I am giving you the total aggregate.

Senator WONG: The decision was made by government to change the 2013-14 expenditure in the way that has been outlined in the table. Can you explain to me what, if any, relationship there is between the committed funds, as you have described them, and the figures in 2013-14?

Mr Wood : I am not sure that I can help you. As we said earlier, those were the decisions taken by government.

Senator WONG: I accept that. I am just trying to get a sense of whether you were asked to go through a process of providing data—you must have been—as to what was committed, and whether there is any relationship between the number in 2013-14 now and what is committed in your system? Is it the same number, is it a higher number or is it a lower number?

Mr Wood : That would be different across a whole number of regions.

Senator FAULKNER: Can I ask a non-former finance minister's question—but as someone who has always been on the receiving end from finance ministers. This question is to you, Mr Varghese. I assume that, in the process we have talked about of discussion and negotiation et cetera, what the department cannot do is touch those funds described as committed, expended, contracted, FMA reg 9. You cannot touch those, can you—they are gone? Have I got that right? I realise that is not a technical question.

Mr Varghese : I will stand to be corrected, because the nomenclature has confused me as much as probably everybody else. Obviously we cannot touch expended. Obviously we would not choose to touch expenditure that is legally contracted. Whether or not we could touch expenditure which is the subject of a reg 9 process I think is a more open question.

Senator FAULKNER: Thank you.

Mr Wood : Senator, if I could help—and I hope I do not confuse this further: that is where it may be possible to defer an activity or defer a payment. If an activity were to take place in May or June, maybe it could be deferred until July.

Senator FAULKNER: I appreciate that; it is really what I was asking. What it is not possible to do is touch expended or legally contracted funds, obviously. That does not amount, one assumes, to 80 per cent, but do you have a figure for what that percentage of the budget is?

Mr Wood : No, I do not personally know. It may depend on the type of agreement or the contract as to whether there are clauses around it.

Senator FAULKNER: I will not delay this, because I know Senator Wong is keen to continue. Can you take on notice—and I hope the department can respond as quickly as possible—the proportion of the budget in those categories that we are now speaking of: expended, contracted, those subject to FMA reg 9 and unallocated? I think there are effectively four?

Mr Wood : That is correct, Senator.

Senator FAULKNER: If you could give us that percentage in relevant years that would be very helpful. Obviously, the committee will be asking as soon as possible for an indication of what particular programs and projects fall into certain of those areas.

Mr Wood : Just to clarify: that will be at the regional level which we referred to previously?

Senator DASTYARI: Regional and then with the major country. The way your database seems to work is that there are regions and then there are the major regions.

Senator FAULKNER: No, it is more that it is regional or subregional at the project level. Do you want project level?

Senator WONG: Can I ask in two parts?

Senator FAULKNER: Only two?

Senator WONG: Frankly, I do not want to get an answer if there is too much work with it broken down into subregionals. So if your database is predicated on regional programs then we would like the information in the form that has just been described. If you are able to give it to us in terms of country programs, we would like that as well. I assume global programs are separately tracked?

Mr Wood : Correct; NTS.

Senator WONG: I will remember your name now! I presume the global programs are separately tracked.

Mr Wood : Correct, and the cross-regional programs.

Senator WONG: I would appreciate that. Did you understand that request to be a forward estimate request or only 2013-14?

Mr Wood : 2013-14.

Senator WONG: Separately, I would ask for the same information.

Senator FAULKNER: I said all relevant budget years. That is what I meant. I am afraid I was not meaning to be limiting.

Senator WONG: It may be more efficient for you to give us nominal figures rather than percentages; that would be fine.

Mr Wood : We have clever spreadsheets, so that will be okay.

Senator WONG: Thank you.

Senator FAWCETT: There is a gap there, so I could ask a question?

Senator WONG: I just breathed.

CHAIR: That is a gap. So we will hand over to Senator Fawcett. Senator Wong, you have been going for a long time now.

Senator WONG: It is not that long, is it?

CHAIR: Amazingly, time passes very quickly here.

Senator FAWCETT: Mr Varghese, I want to move to something completely different under program 1.5. Having spent a number of years living in Thailand, where my father was working for the original Colombo Plan, I am a great believer in the Colombo Plan. Could you give the committee an update on where we are at with agreements with regional partners for the New Colombo Plan.

Mr Varghese : I think the relevant officer has gone home, because it is outside of the aid program. Let me give you my understanding of where we are. As you know, we are running a pilot program this year, which covers four countries—Japan, Indonesia, Singapore and Hong Kong. So we are well advanced in our discussions with each of those countries on how the program is going to work. We have recently had the first allocation of mobility grants. I think, from recollection, 26 or 28 universities were part of that process.

Senator FAWCETT: Including some in South Australia?

Mr Varghese : I am sure some in South Australia. The response was extremely good. We have advertised for the first tranche of scholarships—so, that is scholarships on top of mobility grants. Scholarships will be for longer periods of study. We are now in the process of ensuring that both those scholarships and mobility grant awardees are able to fulfil their stints. It is going to be something that is essentially organised through the universities, because the way we have structured this program is that we are piggybacking off the arrangements that universities have with partner institutions and also drawing on university resources for work placements because that is part of the concept.

We are hopeful that next year we can open up the program to other countries from the Indo-Pacific. We have not made any decisions on how far we will open that up. I expect that at some point the foreign minister will want to consult her regional colleagues and ascertain which ones are interested in joining the project after the pilot phase is over—in other words, joining the project at the beginning of 2015.

Senator FAWCETT: To a certain extent that is part of where my question is going to. I am interested to gauge the regional response and to understand whether in fact other countries are opening dialogue with us about potential inclusion beyond the pilot program.

Mr Varghese : The regional response has been extraordinarily positive, if I could put it that way. Obviously the four that we are negotiating with are part of the process. But I think it is fair to say that everywhere the foreign minister has travelled and everywhere the Prime Minister has travelled there has been a very positive response to this project, and in a number of cases countries have been asking how they can be associated with it. So I assume that when we get beyond the pilot phase we will have a large number of partners, from 2015 onwards.

Senator FAWCETT: Can I move now to program 1.6, PNG. Over the last two or three estimates I have particularly asked about the WASH program in PNG and our engagement with that. The question I have been seeking to get the department to consider is the fact that PNG's WASH statistics have improved but have peaked and have now tailed off because funding is not going to sustainment for WASH activities. My question to the department has been: what are we doing in looking at the effectiveness of the spend and are we monitoring those WASH statistics and any attempt to encourage sustainment of the infrastructure that has been put in place?

Mr Dunn : I do not have figures with me on the current WASH statistics, but it is one of the key focus areas for the program in PNG. We do monitor the program on an ongoing basis. You may be aware there is an assessment underway at the moment looking at the shape of the PNG program going forward, and that is looking at the balance within the sectoral profile of the program.

Senator FAWCETT: Can you comment on whether, as you make this evaluation and consider future funding models, you are also looking at how you make sure the project as a whole considers sustainment so that, having made the investment, we know that it will be there in 10 years time.

Mr Dunn : Yes, certainly. We do an annual review of all of our projects in terms of their implementation. One of the specific factors we look at is sustainability, looking at whether in fact it is making sustainable changes in terms of the PNG system, what funding is being allocated by the partner government and what prospects there are for sustained change over time. Sustainability is one of the key indicators that we look at on an annual basis.

Senator FAWCETT: Do you find much variation between countries in the Pacific region in terms of their willingness to engage as a partner in that sustainability piece?

Mr Dunn : Yes, there is some variability, as you would expect. It changes a little bit over time, according to particular events in a partner country—changes of government, changes of key personnel in counterpart agencies. It does vary over time, but it is one of the key elements of engagement with partner governments. More broadly in the Pacific, and in PNG of course, we rely on Partnerships for Development, which sets out our mutual targets, mutual commitments and standards that we will be held to account for. Sustainability is a key part of that.

Senator FAWCETT: What resources or specific activities are you considering supporting or do you have running that look to improve the governance, or the capability, within our partner nations to consider, fund and successfully implement that sustainment piece?

Mr Dunn : Do you mean in terms of specific activities?

Senator FAWCETT: Yes. Are you working on a government-to-government level? Are you funding people like Coffey or ACIL, or others, to do that kind of work specifically looking at raising awareness and capacity to do the sustainment?

Mr Dunn : Yes, building capacity is a core element of all of our activities.

Senator FAWCETT: But it is a very broad spectrum, though. I am interested in really focusing in to say if we are targeting particular countries or particular groups within countries to very specifically target this issue of sustainment.

Mr L Dunn : A key focus is on partner government systems—being able to build the capacity of the partner government systems to sustain and maintain the sort of appropriate or targeted expenditures going forward. In some countries where civil society has a stronger role we work more directly with civil society to focus on building their capacity to carry forward service delivery. For example, it is a key role of the churches in PNG in terms of health service delivery. They are one of the key partners we work with in terms of building their capacity to maintain service delivery. So it will depend on the country context, on how and where different partners are operating there. But it is one of the key areas of focus.

Senator FAWCETT: Staying with PNG but moving to a slightly different area, there has been a lot of media recently about domestic violence, particularly violence against women, in PNG. Do you have any specific programs you can update the committee on where we are committing resources and effort to seek to address that issue?

Mr L Dunn : Yes, certainly we do. You are right. Violence against women is a major problem in the Pacific more broadly but in PNG particularly. I have a couple of key figures that provide a bit of context on that. In 2012 PNG was ranked by the World Bank as one of the worst countries in the world for sexual violence. Various studies have shown that anywhere between 60 and 100 per cent of women have experienced violence at some point in their lives. The Women's Economic Opportunity Index ranks women of PNG 125th out of 128 countries. So there is a whole series of indicators that show the scale of the problem.

You would be aware that a major focus, or flagship, in terms of addressing violence against women is the broader Pacific Women Shaping Pacific Development program, which is a $300 million ten-year commitment to address those issues. PNG is one of the priority countries for that program. I can give you a little bit of detail on that if you would like.

Senator FAWCETT: What I would be interested in is how you are planning to measure the effectiveness so that you can look to expand it within PNG, or continue it or take it to other countries. What measures are you looking at, how is it being evaluated and what is the feedback to date about the program?

Mr L Dunn : A monitoring evaluation framework has been developed as part of the overarching activity. In each of the countries we are developing an individual country plan for each of the Pacific countries. To date three have been published. The remaining 11 will be published shortly. They set out the sort of change framework we would be looking for and the sort of activities that would be undertaken and the way in which effectiveness would be measured. The program is in the early stages. We are only into the first year of implementation, so we are not at the stage yet of having a lot of feedback from those activities. But monitoring and evaluation is built into that program and will form a feedback loop as we go through the implementation period.

Senator FAWCETT: I thought I heard you say that you have three plans published out of a number of programs. Surely, understanding the objectives you are seeking to achieve—the KPIs and how you are going to measure and report those—would actually be an essential element before you approved the funding to go into it?

Mr L Dunn : That is the role of the individual country plans. They set out what will be the activities over the period going forward.

Senator FAWCETT: So if you have published only three does that mean you only have three programs currently funded and operating?

Mr L Dunn : All of the plans are in draft and three have been published. The remaining ones are very close to being published. We are into the second year of the implementation of the Pacific Women Shaping Pacific Development plan and I think the expenditure so far for that program in 2012-13 was $6 million, and it is estimated that this year $10 million will be expended. So it is very much the start of the build-up of the program.

Senator FAWCETT: One of my constant soapboxes is that inputs are all very good and well—they make for good announcements—but I am really concerned about outcomes, otherwise we have wasted the input. How soon do you think you will be able to start reporting to this committee what the outcomes are against the measures you have identified?

Mr L Dunn: They will be getting reported in our normal performance reporting process, so we will be starting to pick that up now. We are just going through our annual quality implementation reporting process, so we will be having a look at some of the early experience from those programs that are already up and running. That will form part of the ongoing monitoring of that program as we go forward. We will be able to report on that on an annual basis in terms of how well it is achieving issues around effectiveness, efficiency and sustainability.

Senator FAWCETT: What aspects of the program look at economic empowerment of women and also the opportunity for women to become involved in the political process?

Mr L Dunn: There are a couple of key elements. There is a strong focus on supporting women leaders in their leadership roles. It also involves significant twinning arrangements, support of female parliamentarians and women who are considering running for office. So there is training support and there are twinning arrangements to support them. There is a lot of the broader support around economic participation. There is a strong focus, for example, on local markets—improving the safety of women's participation in them with the ability to safely market products. A large part of the program is around trying to support economic participation of women in their communities.

Senator FAWCETT: With economic participation, to what extent has the private sector, either in PNG or Australia, become engaged with that, in terms of capacity building, training, trading opportunities et cetera? Is it all public money or is there also private investment in that?

Ms Klugman: Picking up on Mr Dunn's testimony, particularly, as he has pointed out this is a 10-year, very substantial multi-country program. We are only in the early stages of it, so there is a great opportunity to shape it and develop it. The incoming minister has made it very clear that economic empowerment of women and private sector involvement in the activities we are going to stage under this initiative will be a priority for her. Already, business women's groups and professional women's groups, where they exist—for example in PNG they do exist—have been part of the planning and the networking activities that have been done under the program. The other big area of networking activity is the area Mr Dunn has just referred to, which is future women leaders and parliamentarians. There have already been activities that have involved female members of the Australian Parliament—the Senate and the House—under the rubric of the Pacific Women Shaping Pacific Development program.

That is a substantial multi-year program, but integrated into many aspects of our other bilateral aid work in a country like Papua New Guinea is a gender component. In education there is a lot of focus on getting girls into schools and upgrading and improving girls' education. Our police deployment, such as that in Port Moresby, for example, includes setting up and support for a women's assault and sexual violence unit.

So there is the flagship program that has women in its title, but there is integration of women's issues through many of the other programs and projects we run in a country like Papua New Guinea.

Mr L Dunn : In terms of that specific focus around the private sector involvement and engagement, there has been work in setting up a Pacific business coalition for women, which actually does bring together a series of significant private sector companies that are engaged in the region, to empower women's involvement. As Ms Klugman mentioned, broader work—for example, in financial services through the International Finance Corporation—has helped provide over 200,000 women with access to basic payment and cash services through mobile banking. There is a range of assistance available and programs targeted on that.

Senator FAWCETT: How involved is Papua New Guinea with the Centre for Democratic Institutions program? Is there any specific funding or level of engagement that is seeking to enhance their democratic system and the involvement of a broad section of community?

Mr L Dunn : Do you mean CDI specifically, Senator?

Senator FAWCETT: Yes.

Mr L Dunn : Yes, there is. CDI does have a work program targeting work in PNG. I think the work program for CDI was provided to you as part of one of the answers on notice, and it gives you a detailed listing of the activities that are being undertaken. It includes a significant amount of work in PNG. I do not have it easily to hand, but it is set out in that work program for CDI. It particularly works in six partner governments in the Pacific: Solomon Islands, PNG, Fiji, Vanuatu, Timor-Leste and Indonesia.

Senator KROGER: Mr Dunn, how central is poverty reduction to our policies and our approach to the support of this region in particular?

Mr L Dunn : As the secretary outlined earlier, the role that sustainable economic growth plays in driving poverty alleviation is central to the program.

Senator KROGER: Is it the No.1 driver in PNG given the challenges that it faces as a nation? We have canvassed during estimates the challenges that the country faces and our critical support for a number of years, but I would have thought that it still remains a central feature—component, if you like—of our support in the region. Would you agree with that?

Mr L Dunn : In terms of direct focus on poverty alleviation?

Senator KROGER: Yes, on the reduction of poverty and raising people up from the bottom percentile that are caught up in poverty, particularly women and children.

Mr L Dunn : I go back to the statements from the secretary earlier. Yes, poverty alleviation is central, but it is understood that the key way to achieve poverty alleviation is through sustainable economic growth. The experience in the last decade or so shows that the most significant gains in poverty reduction have been where there has been sustained economic growth.

In PNG there have been 10 years of growth and 10 years of macro-economic stability, but we have not seen the indicators heading in the way you would expect. So there are issues there around the quality of growth and how inclusive it is. These are some of the issues that we are looking at with PNG in the assessment of where and how the program may need to change. It puts sustainable economic growth as central to the poverty alleviation challenge.

Mr McDonald : I would add to that, in relation to poverty alleviation, the minister has already outlined in a number of her speeches the importance around gender equality, women's empowerment, education and health—particularly strengthening the health systems—quality of education and, of course, the humanitarian responses that we need to make across the disasters that we experience on a regular basis. They are key parts of lifting people up.

Senator KROGER: Thank you for that response, because there was, in the inquiry on Friday that we have already spoken of, a constant suggestion that the focus has been taken away from poverty reduction. I think that one can never stress enough the importance of it and how it is central to this government's approach.

Ms Klugman, this brings me to you. I see you here in another capacity, but I have spoken to you in your former capacity as ambassador for women. This was an area that you put a lot of focus into and were very involved in.

Ms Klugman : I think you are thinking of Penny Williams who—

Senator KROGER: I am thinking of Penny Williams.

Ms Klugman : You are thinking of me in a Sri Lanka context, I think, rather than a—

Senator KROGER: I am, thank you for that correction. Does Ms Williams appear here in any capacity now?

Mr Varghese : She is currently living in Geneva, accompanying her spouse as WTO ambassador.

Senator KROGER: I know that the former senator is in that capacity. I was going to ask Ms Williams a couple of questions, but she clearly is enjoying herself in Geneva, and good luck to her. Concluding on this area, do you think that there are areas that have not received the focus that they should have in the past and that we should put a greater concentrated effort into trying to support and to achieve the outcomes that we are looking for? Is there somewhere that we perhaps have been remiss and should have put a bit more money, funding, towards, that would help our goal in PNG, given the complexity of the nation?

Mr Dunn : I think the minister has been outlining the key sorts of changes in direction that we need to look at—that is, supporting private sector growth; looking at economic participation, particularly of women; and looking at how well and able partner countries are to participate in free and open trade, in that sense of a stronger focus on promoting and driving economic growth and the key role that increased focus on infrastructure may well play in being an enabler of strong economic growth. Again, these are issues that are being looked at in the context of further shaping of the PNG program.

Senator KROGER: Harnessing the private sector is something that has been discussed in many fora, but I do not know if it is something that we have been successful at. PNG is a great example of where the private sector could be harnessed. Have there been opportunities to promote those negotiations and discussions so that we can further engage the private sector? Has that been in any way advanced in the brief time that we have been in office?

Mr Dunn : I think the renewed focus on private sector engagement has resonated. Clearly, private firms and companies are interested in being part of the discussion around the evolving development agendas. The review process we have been looking at is trying to identify what initiatives or focuses may have worked and to see where and how they may be able to discover that. I certainly think the focus on the dynamism of private-sector-led growth is playing out well.

Mr McDonald : On that, I should add that the minister has announced a couple of public-private partnership arrangements in some of her recent trips in the region. So, yes, in terms of some of the initiatives that are being put in place—

Senator KROGER: And do they go directly to PNG? Do any of those cover PNG, or the region more generally?

Mr McDonald : I think the last two were Vietnam and the Philippines, from memory. But in your broader question on private sector emphasis.

Senator KROGER: Thank you.

CHAIR: Senator Fawcett has some other little questions he wishes to ask.

Senator FAWCETT: I have just one more about emergency relief. I asked the question earlier about our engagement through ASEAN and the dialogue and humanitarian relief. With the work we did in the Philippines there was some suggestion about the potential to expand a standing force to respond to disasters in the region. Could you talk a bit more about the work we did in the Philippines and the aspects of that that were particularly valued by the government of the Philippines in that disaster?

Mr Varghese : I think Mr Brazier would be happy to take that.

Mr Brazier : I might ask my colleague, Mr March, to speak about the response by the Australian government in the immediate aftermath of the typhoon. Then perhaps I can add to that on the education side, the recovery phase.

Mr March : I understand the question is that you are seeking a quick overview of the humanitarian response to Typhoon Hainan.

Senator FAWCETT: I would like to understand the Philippine response to the Australian government as to what they found particularly effective and helpful. There has been some discussion particularly with our two new LHDs coming online in coming years as to the role that Australia could or should be playing in terms of regional responses to emergencies and natural disasters.

Mr March : I understand the question and can answer most of it, but I cannot comment about the specifics of the LHD. The Australian response to Typhoon Hainan which hit the Philippines was recognised not only by the Philippine authorities but also by our partners we were acting with as being generous and timely and very effective. We worked on a range of levels—civilian, military, diplomatic and consular—and we worked very closely with the Philippine authorities, as is natural when we are responding in someone else's country.

There were formal thanks offered at the foreign minister level, by diplomatic counterparts in the Department of Foreign Affairs in the Philippines to our embassy, and also at the operational level. We maintain an ability in the department to respond to simultaneous disasters in the Asia-Pacific region, and by that I mean the ability to put and lead deployable teams of Australian capability, be it search and rescue, medical, engineering or whatever. That ability is understood by our partners in Asia and the Pacific and is very, very welcome. We are often expected to lead or coordinate responses and we have structured ourselves accordingly.

Perhaps the last point I would make on the reception to our capacity to do this is that we work very closely with two groups of people as well as the crisis-affected country. The first group would be Australian government partners. We exercise regularly with the Department of Defence. We work very closely with Emergency Management Australia and the Australian Federal Police and, as I intimated, we have strong arrangements for reaching down into the states and using their technical capabilities, be it engineering, medical or search and rescue, to meet the Australian objectives in a response.

The other group of people that we work very closely with are our regional and international partners. Just a quick point on those: for example, in the response to Typhoon Hainan the Australian government also supported the ASEAN Secretariat, their disaster response centre, in Jakarta to be able to deploy both their officials and their ASEAN assessment teams into the Philippines to work with the Philippine' government. We are assisting again through Australian funding for the ASEAN Secretariat in Jakarta to assist the Philippines do a 'lessons-learned' process.

Just on lessons learned, and then I will cease, what we have found generally at the broadbrush level is that it was effective, it was timely, it was well coordinated. The civil-military links worked well. There was inevitable confusion in the first couple of days of the response, but that is the definition of a crisis: you do not have the time or the information or the resources in the early days. But across the board it showed a maturation not only of Australia's ability to respond to crises in the region but also that of partner countries.

Senator FAWCETT: Before we move on to education, where you have talked about the BEST Program and others, my understanding is that the Chinese response eventually came but was somewhat delayed. What interaction was there in terms of cooperative work with the Chinese when they arrived? Is there potential to further our work with them in terms of exercising and developing a cooperative disaster response capability?

Mr March : I am not aware of specifics or details of Australian government interaction with the Chinese response. I can confirm that the Philippines authorities were very careful and meticulous in deciding and guiding and phasing where offers of international assistance would be accepted and, if they were accepted, where they would go. They worked very closely with the US authorities in the early days, when the US were providing logistics, airlift and sea transport. The timing and level of engagement with the international counterparts was very much, and appropriately, guided by Philippines authorities.

In terms of working with the Chinese going forward, I am aware that the Australian Defence Force have a number of exercises in the humanitarian assistance and disaster response space, that they are looking at how they will phase ongoing collaboration with the Chinese, but at this stage that has not engaged the aid program.

Mr Brazier : Senator, Typhoon Haiyan damaged 12½-thousand classrooms across 2½-thousand schools in the typhoon affected region, and 4½-thousand of those classrooms require complete replacement. This compounds an existing problem in the Philippines, and that is a shortage of around 93,000 classrooms across the country. The foreign minister, during her recent visit to the Philippines, announced a new Australian-Philippines program, the Basic Education Sector Transformation Program, happily abbreviated to BEST. Around 50 per cent of the classrooms expected to be built across the Philippines under this project will be built in the typhoon affected area.

Senator FAWCETT: So it's purely infrastructure, or are you also looking at providing teaching supplies, helping staff et cetera?

Mr Brazier : It is not purely infrastructure. It is a six-year, $150 million program that will benefit around eight million boys and girls by, yes, constructing classrooms but also working on curriculum development by helping the Philippines extend the typical duration of schooling to a full 12 years.

Senator FAWCETT: Thank you.

Senator WONG: I want to quickly return to the Global Partnership for Education, which was the subject of some questioning from Senator Kroger. Can I confirm that that has in fact been funded since 2007—is that correct?

Mr McDonald : I believe that is correct. I said that I would check that.

Senator WONG: And in 2011 the then foreign minister in fact announced in the House of Representatives one of the priority areas of funding including this particular partnership?

Mr McDonald : I would need to confirm that on notice.

Senator WONG: Mr Wood, I assume that the line item under which this would be funded is global education programs—would that be right?

Mr Wood : I think that is correct.

Senator WONG: Which are in fact one of the few areas that are increasing in 2013-14?

Mr Wood : That is correct.

Senator WONG: That would be because it is consistent with the government's priorities—correct?

Mr Wood : Correct. That payment is under the global education programs line item.

Senator WONG: As the global partnership, has there been a reduction in funding in the government's decision on the 2013-14—

Mr Wood : As you would know from the table, there was no reduction on that expenditure line item of $70 million.

Senator WONG: Correct. So, to non-finance speak it, the current government is, in fact, not only not cutting that particular program but in relation to global education programs it is funding slightly more in the 13-14 year than in the budget. Is that right?

Mr Wood : That is correct, Senator. That reflects the agreed payment schedule under that commitment.

Senator WONG: Thank you. In terms of Ms Bishop's engagement, are you aware, Mr Varghese—or perhaps through you, Minister—whether Ms Bishop since she became minister has met with anyone from the GPE?

Mr McDonald : I am not aware, Senator.

Senator WONG: Are you aware that when Ms Bellamy, the then chair of the GPE visited in 2012, she met amongst others the then shadow minister as Ms Bishop then was?

Mr McDonald : I believe so, but I would need to check.

Senator WONG: Does anyone here know about the global partnership?

Mr McDonald : I was talking about it before, Senator. What is your question?

Senator WONG: I am coming to it. Are you aware of who the chief executive is?

Mr McDonald : Yes, I am.

Senator WONG: And who is that?

Mr McDonald : Alice Albright.

Senator WONG: She served in President Obama's administration. Is that correct?

Mr McDonald : I believe so.

Senator WONG: And the Export-Import Bank, managing about $30-40 billion worth of financing.

Mr McDonald : I do not have that level of detail, Senator, but I do know that Alice Albright is the CEO.

Senator FAWCETT: I would like to ask one clarifying question of Mr Wood. To go back to the discussion about committed and contracted and all the rest of it, the 278 or so, was that committed or contracted funding?

Mr Wood : That would be contracted, because we have that agreement.

Senator FAWCETT: So, it would not have been possible even if the government had wished to reduce it, because it has already been contracted.

Mr Wood : Correct, Senator. That payment may have already been made, but I do not know if that was the case.

Senator WONG: Is there a government decision to reduce that program?

Mr Wood : No, Senator. The budget process we are going through now is for 14-15 and beyond.

Proceedings suspended from 18:22 to 18:26

CHAIR: Let us proceed now.

Senator RHIANNON: The Green Book, DFAT's annual and much looked forward to comprehensive statistical summary on Australian aid, was last published in 2011-12, as far as I know. When will the 2012-13 Green Book be out?

Mr Wood : Very shortly. I recall seeing a draft of it last week. That will cover the 2012-13 financial year and will also include the updates for the website with a statistical analysis.

Senator RHIANNON: Can you give us a date, because it is quite overdue?

Mr Wood : I think the time is consistent with the 2011-12 year. It is a really hard document to put together because there is a lot of data cleansing and analysis. There is a huge amount work that the team do in putting it together. It will be by the end of March.

Senator RHIANNON: When will you get the 2013-14 Green Book out? Will it be by the end of March next year, or can you bring it forward?

Mr Wood : I would like to say so. As I say, it does require a lot of work, so that would be an appropriate time.

Senator RHIANNON: DFAT answered a question on notice—number 306—from November 2013 estimates, that, as at November, Australia had spent $62.52 million on humanitarian emergency response. Is that correct?

Mr McDonald : That would be correct if it is in the answer.

Senator RHIANNON: If I understand correctly, the remaining budget for HER therefore should be $137.4 million, less the $75.57 million which comes from the money that the government has announced—$10 million for Syria, $3 million for South sedan and $50,000 for Tonga. This brings us to the $61.83 million. Is that correct?

Mr McDonald : I will ask Ms Walker to answer that. I think some of those last figures you were talking about relate to our Mandated Flexibility fund.

Senator RHIANNON: I am really trying to get a handle on HER, so that would be good.

Ms Walker : Perhaps I could start by indicating what we have contributed in 2013-14 to humanitarian emergencies. The total figure is $77.4 million, and the very large amounts in that—some $70 million—are $40,000 for typhoon Haiyan, and $30.5 million for the Syria conflict. There is also the response to tropical cyclone Ian in Tonga, to flooding and landslides in Indonesia, to some civil conflict in Mindanao and in Guinea-Bissau, to some demining in Mozambique and to the protracted crisis in South Sudan. That is the total, year-to-date, of our contributions to emergencies.

Senator RHIANNON: How much do we have left?

Ms Walker : The budget this year is $264.2 million. We do have some remaining flexibility to respond to any sudden onset emergencies between now and the end of the financial year.

Senator RHIANNON: So how much do we have left?

Ms Walker : We have in the order of $20 million to $30 million, as I understand it.

Senator RHIANNON: Given that there is $20 million to $30 million left, why has Australia only given one-tenth of its fair share to the global $6.5 billion appeal for the Syrian crisis?

Mr Varghese : I think we covered some of this earlier. The amount of money we have given to Syria is $112 million, as I understand it. I think by any measure that is a substantial amount of money, particularly set against the other countries, particularly in Europe, who have very important interests in Syria and have a capacity to pay.

Senator RHIANNON: What will the government do with the remaining CERF funding if it is not committed to emergencies by 30 June?

Mr McDonald : This issue was talked about a little bit on Friday when we met. The mandated flexibility fund that this funding comes out of was reduced from $120 million to $90 million at the start of the financial year. We work on the basis of around $10 million a month for these sorts of things. Given we have about $20-odd million left between now and the end of the year, it is quite likely that we will expend that funding.

Senator RHIANNON: Sorry, extend the funding?

Mr McDonald : No, expend it. So because of the time period to go—there are still four months to go, and we have $20 million left—and because we are, as you know, in a very disaster prone area, we will just have to wait and see.

Senator RHIANNON: So are you holding onto it in case there are typhoons in our area, or that sort of thing? Is that how it works?

Mr McDonald : Yes, or emergencies elsewhere in the world. We allocate a fund each year for that purpose because we have either cyclones or earthquakes, particularly in our region.

Senator RHIANNON: So come 30 June, and we still have $20 million or $15 million, what happens?

Mr McDonald : I would need to check.

Senator RHIANNON: Is it rolled over? Do you identify a crisis and decide to spend it on that crisis?

Mr Wood : That would not happen. Generally, that funding is paid out. As Mr McDonald said, we usually try to pro rata or ration it over the year, but I do not foresee a case where there would be the whole amount left over.

Senator RHIANNON: Can you explain that? How can you say it will not happen if you have $20 million now and there are no emergencies between now and 30 June? What do you do with your $20 million? How have you decided the pro rata arrangement?

Mr Wood : I do not think we have had an occasion where there has not been something happen somewhere in the world between March and the end of June.

Senator RHIANNON: Could you take it on notice and provide us with the policy guidance that you have to make decisions on any money that may remain?

Mr McDonald : The other thing on that is that in the first eight months of the year we have spent $70 million out of that fund.

Senator RHIANNON: Yes, but you never know; the world might be peaceful for a while. The aid program Medical Research Strategy was established in response to the recommendations of the 2011 aid effectiveness review as an initiative that would deliver high returns on investment through the development of new vaccines and drugs for diseases in low-income countries. Why did DFAT terminate funding of its Medical Research Strategy in January this year, particularly considering it was in contradiction of the aid effectiveness review?

Mr McDonald : We did not terminate the funding in January of this year. The last allocation under that was made in June 2013. That was the last budgeted amount, so there was no funding in the budget for that this year. The program is still ongoing throughout a two-year period, I think, and is to be completed by 30 June, but I will ask Mr Exell to confirm that for me.

Mr Exell : That is correct. The PDPs, product development partnerships, were funded in June 2013. It actually runs for one year through to June 2014. From memory, that was a $10 million funding program across four partners.

Senator RHIANNON: So you are saying that you will continued to fund it up to June 2014?

Mr Exell : Correct.

Senator RHIANNON: So when will the next disbursement be?

Mr Exell : I will take that on notice just to check the payment schedule, but the activities are continuing in full.

Senator RHIANNON: Does the full financial commitment that was originally made continue?

Mr Exell : That is correct.

Senator RHIANNON: Thank you. The mining for development section of the Department of Foreign Affairs and Trade website states that the initiative received $42 million in funding for the last financial year. However, when you look at the website, the figures do not add up; it only discloses $14.25 million of spending. The International Mining for Development Centre came in at $7 million. The Extractive Industries Transparency Initiative cost $5.35 million. The Extractive Industries Technical Advisory Facility cost $1 million, and the Geoscience Strengthening Program cost $0.9 million. Can you clarify where the remaining $27.75 million has been spent?

Mr McDonald : We might need to take that on notice.

Senator RHIANNON: Is there nobody here who can clarify that? It is one of your major projects.

Mr McDonald : You are talking about the website having one figure and then a set of other figures. We would need to look at that.

Senator RHIANNON: You do not give the full details of how the money is being spent.

Mr McDonald : We would need to take that on notice and have a look at what you are referring to.

Senator RHIANNON: Will the Mining for Development Initiative continue?

Mr McDonald : The Mining for Development Initiative is currently in place, yes.

Senator RHIANNON: Are there plans for the program to continue?

Mr McDonald : As I said earlier, we are now going through the 2014-15 budget process and no decisions have yet been made by government.

Senator RHIANNON: When the cuts were made to various aid programs was this Mining for Development Initiative cut in any way?

Mr McDonald : I would need to take that on notice but I do not think so.

Senator RHIANNON: Seriously, there must be somebody here who knows.

Mr McDonald : I do not believe it was, no.

Senator RHIANNON: But you will check?

Mr McDonald : I will check.

Senator RHIANNON: Was Australian aid money used for the recent mining indaba in Cape Town which took place in early February?

Mr McDonald : I would be happy to take that on notice.

Senator RHIANNON: Are you aware that in a Palestinian village, Susiya, in the South Hebron Hills of the West Bank, a kindergarten and a clinic that I understand is funded by DFAT are under imminent threat of demolition?

Mr Innes-Brown : We are aware there are some issues concerning proposed demolition orders on the West Bank. I do not have the specific information on the properties you mentioned. However, we are continuing to monitor the situation, obviously, to make sure that projects we have funded are not affected by any such activity.

Senator RHIANNON: Can you share with the committee what information you do have about threats to Australian funded aid projects in Palestine?

Mr Innes-Brown : We are generally aware that there are 3,000 proposed demolition orders, which could impact on around 16 schools in what is known as Area C of the Israeli administered area of the West Bank.

Senator RHIANNON: Are any of those schools funded by Australian bilateral aid or multilateral aid or NGO aid that may have an Australian component?

Mr Innes-Brown : Not in the information that I have before me but I think I would prefer to do some more checking for you and give you a very robust answer on that. But it is not in any information I have before me.

Senator RHIANNON: Does the department recognise that this is an extraordinary situation where it is Australian public money going to aid projects that people believe are doing something good in the world, and then they are being destroyed and you do not have the details about that? Could you explain whether this is because it is difficult to get the information or because it is not a priority?

Mr Innes-Brown : Before getting to the heart of your question I would like to get the facts, and once we have that information we can look at the issue. I cannot answer the question without definitive information on whether Australian funded projects are affected by this or not. I do not have that information before me. It is not a question of being a priority or not been a priority. There are obviously a lot of questions that can be asked in a session like this and sometimes we do not have all the information. I will make further inquiries for you.

Senator RHIANNON: Considering that these threats to a number of Australian aid projects in the West Bank—some of them have been dismantled; some of them have been destroyed to varying degrees—have happened for a number of years, what arrangement do you have with our representatives in the Palestinian occupied territories and in Israel to monitor this situation?

Mr Innes-Brown : Generally speaking we have representatives in Ramallah and in Israel, diplomatic representatives and aid officials, who are obviously keeping a close watch on issues that relate to our programs.

Senator RHIANNON: What does 'a close watch' mean, please?

Mr Innes-Brown : Obviously money has been disbursed or there might be ongoing programs, and they are monitoring the expenditure of that money. Issues impacting Australia and Australian money they take a close interest in.

Senator RHIANNON: Is there any Australian aid money funding projects in Gaza?

Mr Innes-Brown : I think there is.

Mr McDonald : Yes, there is.

Senator RHIANNON: Could you provide details please.

Mr McDonald : Under the AMENCA NGO program, there is funding that is providing support within Gaza.

Senator RHIANNON: Was that program cut in the recent rounds of reduction in aid?

Mr McDonald : I do not believe so, but I will check.

Senator RHIANNON: Could you check in terms of bilateral programs and multilateral programs that go into Gaza please?

Mr McDonald : Yes.

Senator RHIANNON: And NGO aid money.

Senator FAULKNER: How can you say that, Mr McDonald, when there is no certainty about a range of other projects?

Mr McDonald : No, what I am saying is: in relation to the AMENCA program itself, which is one of the programs in the table, I do not believe there was any reduction in this, but I will check.

Mr Wood : We just have reporting at the level of Palestinian territories.

Mr McDonald : Yes, we would need to break it down. The Palestinian territories budgeted figure was 38.7 and it is 33.4. Within that, there is an NGO program and there are other funds that go to—

Senator FAULKNER: Yes, I understand. I am just surprised that you could be definitive about that program in the context of the earlier evidence to the committee. I am not doubting it, but could you just explain to me how you can be?

Mr McDonald : Because within each of those lines there are reductions occurring, and I will need to check whether AMENCA, which is the program that is providing funding into Gaza, has been reduced or not. And, as I said, I do not believe it has, but I would need to check that.

Senator FAULKNER: That is fine. It is slightly different to say you need to check from 'No'.

Mr McDonald : That is what I said to the senator originally: I do not believe that there has been any reduction, but I would need to check.

Senator RHIANNON: I checked out the DFAT website about climate change research initiatives that the government is currently supporting. The website states that the Australian government is investing $32 million in the Pacific-Australia Climate Change Science and Adaptation Planning Program, and also the CSIRO Horizon 2 research for development alliance and the Center for International Forestry Research and the World Resources Institute. What I was trying to work out was: how much has been allocated for this budget for each of those initiatives? Can you inform us of the line items for those four, please? Just while you are preparing, I was also interested in trying to clarify the international climate change programs that are still under DFAT, or if they are being shifted to other departments.

Ms Sidhu : Many of the programs that you refer to were being conducted under what was known as the fast-start financing program. That ceased at the end of 2012-13. Some projects continued into 2013-14, but effectively there has been no financing for them in this financial year, given that the fast-start period has ceased.

Senator RHIANNON: So those four programs have all been wound up, have they, or are they out of funding?

Ms Sidhu : To be specific I would have to take that on notice and get back to you on those specific programs.

Senator RHIANNON: If you could inform us of the status of the programs and where their funding comes from and obviously, if it is not your department, who do I go to to find out.

Ms Sidhu : Yes, certainly.

Senator RHIANNON: Could you clarify what international climate change programs still are under DFAT. Are there any?

Ms Walsh : Most the line items are retained within the DFAT portfolio. There are some individual programs that might have been administered or managed by other departments, but the majority of the budget rests with DFAT.

Senator RHIANNON: Those four programs that I named are not getting funding and you are going to check if they still exist in some form, so is what you are saying that apart from those four programs by far the majority of programs continue?

Ms Walsh : No, that is not what I am saying.

Senator RHIANNON: I am sorry; I am just trying to clarify.

Ms Walsh : The majority of those line items in the budget are the responsibility of the Department of Foreign Affairs and Trade. Within those line items, in terms of what allocations are there and what funding decisions might be taken about their future, that is subject to the ongoing budget discussions that we have had today.

Senator RHIANNON: Sorry, I missed the last bit. So you are saying that we do not know?

Ms Walsh : They are under consideration, that is right.

Senator RHIANNON: So we will know when the budget comes out?

Ms Walsh : For most of them, that is right.

Senator RHIANNON: What amount of funding, if any, for Indonesian deforestation mitigation measures has been committed to date? Is the department continuing with AusAID's commitment to reducing deforestation in Indonesia.

Mr Brazier : The principal vehicle for the Australian government's work on deforestation in Indonesia has been for some years the Indonesia-Australia Forest Carbon Partnership, of which the Kalimantan Forests and Climate Partnership forms the largest part. The bulk of that program ended on 30 June last year; some elements of it have continued and will continue until the middle of this year, and we have budgeted around $8 million for that in this financial year.

Senator RHIANNON: There were documents released under FOI last November that showed Indonesia actually asked for a two-year extension on that partnership that you have just mentioned, the Indonesia-Australia Forest Carbon Partnership. It appears that the government did not grant that two-year extension. Is that correct?

Mr Brazier : I would have to take that on notice. I was not aware of that FOI application. I may have to refresh my memory, but it would be surprising to me because the program ended when it was scheduled to and, of course, in settling on a one-year extension that was obtained with the full agreement of the Indonesian government.

Senator RHIANNON: Sorry, I may have misunderstood. So you are saying that this partnership has actually now wound up?

Mr Brazier : No. It has shrunk in size but it continues until 30 June this year.

We have continued this year with activities to continue to help communities, in central Kalimantan in particular, adapt to different lifestyles that do not depend on deforestation so much, and also on a national carbon accounting scheme, which helps Indonesia to track carbon emissions in order to meet its undertaking to reduce business-as-usual emissions by 26 per cent before 2020.

Senator RHIANNON: Could you take on notice just to give us an update on the budget allocation for that work?

Mr Brazier : I can take it on notice, yes.

Senator RHIANNON: thank you. How much aid money is being used for offshore processing for domestic detention of refugees and asylum seekers in detention centres and processing centres?

Mr Wood : Aid money is not being used for detention centres. As you know, there is a funding allocation to the Department of Immigration and Border Protection for the sustenance of onshore asylum seekers within the community on bridging visas.

Senator RHIANNON: I am just trying to understand—and I am sorry if you went through this before; I had to go to another committee. So money for sustenance for asylum seekers in Australia, is that correct?

Mr Wood : Correct. There is a reference and a description to it in the 2013-14 aid ministerial statement—the blue book—and that just describes the criteria for reporting those costs.

Senator KROGER: Could you just remind us when the decision was made to reallocate that money for onshore processing? Was that under the former government?

Mr Wood : The decision was taken in December 2012.

Senator KROGER: Okay. So it was under the former government. Thank you.

Senator RHIANNON: Is any aid money that goes to PNG used for projects on Manus Island or associated with any activities on Manus Island?

Mr McDonald : Yes.

Senator RHIANNON: Could you provide the details, please, and the amount?

Mr McDonald : Yes. I will ask my colleagues to come back up to the table. From memory on Manus Island I think it is $40 million, but I will ask my colleagues to confirm that.

Mr Dunn : Are you asking about the expenditure on aid activities on Manus?

Senator RHIANNON: Yes. I am assuming it comes out of the aid budget that goes to PNG.

Mr Dunn : Yes, it does. It is part of the country program.

Senator RHIANNON: How much and what it is used for, please.

Mr Dunn : Australia is providing approximately $40 million in development assistance to Manus over the period 2012 to 2018. It comprises two elements: it is an existing $14 million as part of the PNG-Australia partnership for development and additional assistance of around $26 million, so in total $40 million.

Senator RHIANNON: What is it used for?

Mr Dunn : I will take you through the elements. It has a strong focus on support for the Lorengau hospital. This includes the delivery and installation of medical equipment, the majority of which has been delivered, with the remaining equipment to be delivered by early March; the provision of a new water system for the dental clinic—that work has been completed and the clinic reopened on 10 February this year; and the development of a master plan for further redevelopment work of the hospital. There is a significant component also focusing on education infrastructure. That includes the provision of 20 infrastructure school kits, nine of which have been completed and 11 are nearing completion. These are, effectively, small school infrastructure involving a dual classroom, teachers accommodation, an ablutions block and an administration office. As I say, nine are completed and a further 11 are nearing completion. It is also involving transport infrastructure, which is particularly around the maintenance and rehabilitation of some roads and bridges. Design and scoping is underway for that and construction is due to start in November this year. There is also work being done on the renovation of the market roof at the Lorengau market. That work has commenced, with formal construction to start in July. And there are community grants supporting small-scale sport, income generation and livelihoods. That is part of the additional assistance package. The existing country program I mentioned of $14 million has also a strong focus on health, education, law and justice, transport, infrastructure and community grants.

Senator RHIANNON: Is the $14 million part of the $40 million?

Mr Dunn : Yes.

Senator RHIANNON: Would asylum seekers or workers who are sick use that hospital?

Mr Dunn : I am not sure what the arrangements are.

Senator RHIANNON: Could you please take that on notice.

Mr Dunn : I am not sure I have the knowledge around the asylum seeker centre.

Mr Varghese : The operation of the facility on Manus Island is the responsibility of the Department of Immigration and Border Protection.

Senator RHIANNON: I appreciate that but I am just asking about projects funded by Australian aid. Do you not follow through who uses those facilities?

Mr Varghese : As I understood your question, it was whether the medical facilities outside of the detention centre, namely the hospital that we are helping to fund, are available to detainees. I am saying to you the arrangements with those detainees including their medical care is a matter for the department of immigration.

Senator RHIANNON: Do you know who uses the schools? Is it just local children or is it the children of the workers at the centre? Is it children of detainees?

Mr Varghese : To the extent that it is schooling of people in the detention centre, you would have to direct that to the immigration department.

Senator KROGER: I want to go to the Australian government's cut to funding Grenada. Can you can confirm reports that we did cut funding to that project?

Mr Varghese : I think we covered this earlier in your absence.

Senator KROGER: If you did, that is terrific. Have we covered the Indonesian rhinoceros program?

Mr Varghese : Not to my recollection.

Senator KROGER: Well we have to cover that. When did the program commence?

Mr Brazier : The program did not commence and will not commence.

Senator KROGER: What was the projected cost of the program?

Mr Brazier : The previous foreign minister announced at the end of June last year a three-year $3 million program to support the conservation of Sumatran rhinos.

Senator KROGER: Did the then foreign minister advise supporting that?

Mr Brazier : The foreign minister made a decision to provide those resources for that purpose.

Senator KROGER: Are you aware of any written advice in relation to the cause of the rhino and advocating that Australia be involved in supporting and developing this program?

Mr Brazier : I am aware of advice but, as you know, I cannot go into the content of it.

Senator KROGER: When was this program then determined not to be a viable one?

Mr Brazier : The current foreign minister has decided not to proceed with the program. I would have to check on the date that we were instructed to that effect.

CHAIR: We will suspend the sitting now. I would like to thank Mr Varghese and his staff and senior officers for being here for these estimates and we look forward to seeing you all again in May for the main estimates.

Proceedings suspended from 19:00 to 20:03

CHAIR: I welcome everybody here for these estimates of the trade programs of the Department of Foreign Affairs and Trade. I welcome Senator George Brandis QC, representing the Minister for Trade, and officers from the Department of Foreign Affairs and Trade programs. I welcome Mr Peter Varghese again in his role as overall head of the department. I also welcome Mr Bruce Gosper, chief executive officer, and officers from Austrade; Mr Andrew Hunter, managing director and CEO, and officers from the Export Finance and Insurance Corporation, otherwise known as EFIC; and Ms Frances-Anne Keeler, executive general manager international, and officers from Tourism Australia. This evening the committee will examine the additional estimates from the Trade portfolio, and we will begin with the DFAT trade program, followed by EFIC, Austrade and Tourism Australia. Topics will be considered in the order set out in the agenda. Minister, do you or an officer wish to make an opening statement?

Senator Brandis: No.

CHAIR: Thank you very much.

Senator WONG: I want to commence with some questions on the KAFTA, please. There are some figures that were in the public arena post the announcement of the finalisation of the Korean free trade agreement. For example, $650 million was in the public arena. Can I first check what figures are asserted as the economic benefit of the Korean free trade agreement and where they derive from.

Ms Adams : I think the figures that you are referring to were the number $650 million as the estimate of the annual boost to the economy after 15 years of operation of the agreement. Those figures are from modelling that has been prepared for the government.

Senator WONG: So that is an annual GDP increase figure as at 15 years from the commencement of the agreement?

Ms Adams : That is correct.

Senator WONG: When was that modelling prepared?

Ms Adams : Just recently, immediately before the conclusion of the agreement.

Senator WONG: Who conducted that modelling?

Ms Adams : The Centre for International Economics.

Senator WONG: Is there an intention to release that?

Ms Adams : The government has not yet made a decision on releasing the modelling.

Senator WONG: I presume a range of assumptions were provided. Let us start from the beginning: when was the modelling commenced?

Ms Adams : This modelling was commissioned by the government, obviously after the election, so late last year.

Senator WONG: And, at the time the modelling was commissioned, this agreement had not yet been finalised?

Ms Adams : That is correct.

Senator WONG: In what ways, if any, did the assumptions provided to the modellers differ from the outcome in the agreement?

Ms Adams : I would have to go to look very carefully to see if there were any adjustments that we had to make after the conclusion, but really the agreement was very close and we knew what the agreement was going to look like by that stage, in the broad.

Senator WONG: Does the modelling go to employment impact?

Ms Adams : There was an overall employment number.

Senator WONG: Is that outlined in one of the fact sheets?

Ms Adams : I will have to have a look at the actual media release, but I think there was an overall jobs number in the media release.

Senator WONG: Can you remind me of what it is.