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Legal and Constitutional Affairs Legislation Committee - 20/11/2014 - Estimates - ATTORNEY-GENERAL'S PORTFOLIO - Australia Council

Australia Council

[10:15]

CHAIR: Thank you, Mr Grybowski and Mr Blackwell, for joining us. Do you want to make any sort of opening statement?

Mr Grybowski : No.

Senator WRIGHT: Good morning. I have some questions around the key producers contract. I just want to make sure I have the situation clear, so I want you to confirm if what I understand to be the case is accurate. I understand that there have been 14 contracts in total across the country. Two have them are related to the Tasmanian organisations Kickstart Arts and Big hART and there is one in South Australia. I believe Country Arts SA is one of the parties. I understand that these have all signed contracts with the arts council as key producers for six years of funding, but they have now been told that these contracts will not be honoured and that they have three years of funding and then will have to reapply for a further funding contract under the council's new program arrangements. Is that background correct?

Mr Grybowski : That is correct.

Senator WRIGHT: There have been significant concerns raised with me about this reneging on the previous contracts. Why is the arts council reneging on what I understand were contracts for six years of funding?

Mr Grybowski : First of all, I will confirm that those statements are correct. I should also confirm that this is not a reduction of funding. It is a discontinuation of existing funding arrangements. They were in a three-year plus three-year agreement. Those agreements were discontinued, albeit with funding confirmed until the end of 2016, in the context of some of the most significant reforms of our granting programs undertaken by the Australia Council.

Earlier this year, we announced the reform of our grant programs—grants for individual artists and arts organisations—providing flexibility and greater access to common grant categories, moving from some 140 categories to five common categories. Within those categories are increased and unprecedented opportunities for arts organisations to apply. We are communicating with the sector around the country as we speak, doing workshops to inform the sector of those changes.

Equally important is the support we provide to arts organisations. Currently, we are supporting some 180 regularly funded organisations around the country in a range of ways. The key producers are organisations that have demonstrated outstanding success and leadership in community arts and cultural development. We provide approximately $2.8 million worth of funding to those 14 key producers. But, as part of these reforms, we are instigating a period where we will be looking at all 140 organisations so that we can assess and review them and bring those organisations into line from 2016. So that we could have the greatest transparency and equality in the process, we felt that it was only fair for the arts sector of Australia and for all the arts organisations to reassess at one moment in time.

Those organisations, including the 14 key producers, will be assessed through a two-stage process throughout 2015. That meant a communication to those 14 key producers to advise them of the change. We met with them collectively and individually to explain these changes so that they could come in and be assessed in the complete framework with all the other organisations. The main reason for doing this was to ensure that these organisations had the equal opportunity to be assessed amongst those other organisations.

I always use the example of the Queensland Music Festival, which is currently being supported through the community partnerships program. If we had rolled over and extended that organisation's funding and not assessed it in the context of the other music organisations being assessed next year, it would have been placed at a disadvantage. We are meeting with each of those organisations—

Senator WRIGHT: Sorry, can I clarify that? Who was being placed at a disadvantage?

Mr Grybowski : The Queensland Music Festival, which was already supported through the key producers.

Senator WRIGHT: But they had six years of funding; is that right?

Mr Grybowski : It had six years, or three years plus three years, of funding—

Senator WRIGHT: Yes, which is six years of funding.

Mr Grybowski : but for it not to be assessed in the context of the overall assessment of organisations in music it would be disadvantaged.

Senator WRIGHT: I want to follow this up because I really want to unpack your answer. First of all, you said, 'This isn't a reduction in funding.'

Mr Grybowski : Correct.

Senator WRIGHT: At the risk of quibbling with you about this, my understanding is that the situation at the moment is that these 14 key producers had a contract for six years of funding—three years plus three years, which is six.

Mr Grybowski : Correct.

Senator WRIGHT: It was not that they had a contract for three years of funding and then potentially another three; it was for six. I understand that some of them have entered into other contractual relationships on the basis of that six years of funding. If they are not successful in reapplying, it will be a reduction in funding, won't it? It will be.

Mr Grybowski : Under those circumstances, if they were not successful, it would be. However, those organisations have just been through a round. Also, we are working with them individually to ensure that they will have a strong, competitive advantage. We have made a commitment, too. In the circumstance that they are not successful, we will not let artistic programs collapse and we have committed to ensuring funding through that transition period. In addition, they will have the opportunity to apply through the new flexible one-, two- and three-year funding opportunities through the grants program.

Senator WRIGHT: They will have the opportunity, but there is no guarantee. They have gone from a situation where they were acting, as I understand it, on the understanding that they had a contract with the government for six years of funding. They have been making plans. They have employed staff on that basis. My understanding is that they have actually leveraged contracts with other organisations on that basis. They had been able to say, 'We've got government funding; will you meet that?' There are some that will actually be in breach of their contracts with other funders because of this change. Is that your understanding? Have you been advised that by these key producers?

Mr Grybowski : That is correct. However, we have met with each organisation individually so that we can work with them on any contract or artistic program that has commitments to ensure there is a continuation. We have made a commitment that we will not let artistic programs collapse because of this change. We feel these changes provide us with an incredible opportunity to support in excess of 140 organisations nationally across all art forms, providing opportunities for arts organisations that previously fell through the cracks or were working in very different ways. The new grant program and the two-stage process of assessment next year will strengthen the opportunities for arts organisations right across the country.

Senator WRIGHT: That is why I want to unpack this. I understand that you are saying that this will maybe create opportunities for other arts organisations. But it is a bit disingenuous to suggest that this is a wonderful new opportunity for these organisations which already had a bird in the hand. They already had funding for six years. There may be further opportunities in the restructuring. They may be successful in the future; they may not. I understand what you are saying is the rationale for this but the fact remains that these organisations will have no guarantee of further funding beyond three years. They can put their hat in the ring like other organisations; they may have advantages in that, but there is no guarantee. As a result, there is uncertainty for the staff who have been employed on the understanding that they may have six years of employment. So there are consequences and implications for them.

CHAIR: I think you have made that point.

Senator WRIGHT: You said there will be a guarantee of programs being continued. I am not quite sure what that means. If there are any contractual liabilities, any compensation or any costs on the basis of other parties, is the government going to make sure that that they are indemnified against that?

Mr Grybowksi : No. We will make a commitment to those organisations who have contractual commitments for projects within their organisation to honour those. We have met with all the organisations individually and collectively to ensure that this inconvenience—and we acknowledge that it is an inconvenience—

Senator WRIGHT: It is more than an inconvenience.

Mr Grybowksi : But a number of those key producers recognise the opportunity. While they are a group of 14 organisations they recognise that, with hundreds of organisations to be assessed at one time for a stable and stronger sector, this is a significant and beneficial reform. We are working with those organisations through that process.

Senator WRIGHT: Was any consideration given to grandfathering these 14 existing contracts, honouring the arrangement that was made, and then bringing them into line next time around?

CHAIR: I am not following this. I do not know the issue that Senator Wright is talking about. As I understand it, there are written contract for six years which you are cancelling before the six years is up. Is that correct?

Mr Grybowksi : Yes. We are terminating the—

CHAIR: How can you do legally that for a start?

Mr Grybowksi : There is a clause in the contract that requires us under certain circumstances to actually terminate those contracts.

CHAIR: What are the circumstances?

Mr Grybowksi : The circumstances are the reforms and changes which I have outlined—and a commitment by the Australian—

CHAIR: But what is in the contract? It says: 'You've got funding for six years; go away and work as if you've got that.' But there is a clause that says—what?

Mr Grybowksi : I have not got the contract in front of me but I can provide that.

Senator Brandis: Chair, I will have a look at this. Thank you, Senator Wright, for raising it. As I understand it, Senator Wright, your point is not that the funding may have been discontinued but that the consequence of the discontinuation of the funding may be to expose the recipients to a breach of their contractual obligations with third parties. Is that the point you have been making?

Senator WRIGHT: Yes, it is. There are a couple of implications. One is staff losses, staff unemployment, on the basis that they have been employed with the expectation that they will have a certain—

Senator Brandis: That is kind of a different issue.

Senator WRIGHT: It is an important issue, I think.

Senator Brandis: It is a different issue.

Senator WRIGHT: And there is another one, which is that some of them have entered into contracts with other parties on the basis of leveraging the funding that they have from the Australia Council.

Senator Brandis: It is a serious issue that you raise. Thank you for raising it, Senator Wright. I think this would have to be assessed on a case-by-case basis depending on the particular contractual arrangement between the recipient organisation and the third party. But it certainly in my view is very bad practice for any government to expose a citizen, including a corporate citizen or entity, to being at risk of being in breach of its contract with a third party as a result of a government decision. Contracts can always been renegotiated; contractual rights and obligations can always be reassigned or novated, as you know. We saw, if I may use an analogy from a completely different area of policy, the shocking grief that was caused to so many Australian cattle producers by the shocking decision of the previous government to place them in breach of their contractual obligations to export cattle to Indonesia. That was a very, very shameful and wrong thing to do. I certainly would not tolerate, in my portfolio, an entity being put in a somewhat similar position of being forced into a breach of its contractual obligations as a result of the government decision.

CHAIR: Minister, as I said, this is Senator Wright's issue, but it offends my sense of fair play that they can have a contract for six years which, unilaterally, you can break, with apparently a fine—

Senator Brandis: There might be a termination provision; I think that was Mr Grybowski's point. But Senator Wright's point, as I understood it, was about the effect of contractual obligations on third parties—

CHAIR: Minister, could I—

Senator WRIGHT: I just want to say my other point is that I think that employment contracts are as important as other contracts, and that people engage, they enter into mortgages and they expect to have certain incomes on the basis of their employment—

CHAIR: Thank you, Senator Wright—

Senator WRIGHT: contracts as well.

CHAIR: you have asked your question.

Senator WRIGHT: I have one more.

CHAIR: This is not a debate. Minister, you said you would not have the government break a contract. Just clarify for me: whose responsibility is this? Does the Australia Council have the independent authority to make these deals or do they make recommendations to you?

Senator Brandis: The Australia Council is constituted as an independent agency, and therefore it is the decision maker; but, of course, as an agency within this portfolio it is answerable to me and, ultimately, to this committee.

CHAIR: But do you make the grants or does the Australia Council?

Senator Brandis: Mr Grybowski is speaking of grants made by the Australia Council.

CHAIR: They are not just recommendations to you?

Senator Brandis: No. The Australia Council makes grants, but it does not require the consent of the minister.

CHAIR: Okay. I just wanted to make that clear. I will come back to you, Senator Wright. The other thing is, again, I could not understand your saying they had three plus three years, they had six years, and that was being cut off but that was good for them. That is a perverse logic. Could you explain it to me?

Mr Grybowski : They have funding committed to them to the end of 2016 and a commitment from the Australia Council to support any forward commitments beyond that so that any consequences, should they not be successful—

CHAIR: When does the three plus three end? Is that in 2016?

Mr Grybowski : End of 2019.

CHAIR: So they have a commitment to 2019 but you are saying you are going to cut it off in 2016; but, if they have some other commitments arising from that, you will look after them?

Mr Grybowski : Correct, because that is our commitment to managing the transition while we look at the overall funding. So we bring all our other organisations into alignment to enter into six-year agreements.

CHAIR: I do not want to be pedantic, but you are saying you are cutting them off three years early and that is good for them because, if they have committed themselves, you will look after them. That is hardly good for them. At least it is—

Mr Grybowski : That is the opportunity, so that those organisations are actually assessed—and some of those organisations have agreed and want to be assessed—within the context of those other music organisations. A lot of these organisations work across different art forms and across music, the community space, in visual arts. It is so that, when we assess all the applications from the hundreds of organisations around the country, they are considered on a level playing field so that we can then enter into—

CHAIR: I can understand why others would say this is a good deal—because they might get something now that they did not get before. But I cannot understand your comment that it is a good deal for those 16 people, was it, except in their philanthropic—

Mr Grybowski : It is 14 organisations.

CHAIR: Sorry?

Mr Grybowski : There are 14 organisations.

CHAIR: Fourteen.

Mr Grybowski : Yes.

Senator Brandis: Chair, I think there is obviously an important legal and conceptual difference between enabling the 14 organisations to fulfil their contractual obligations, if they have them, on the one hand, and indemnifying them against a damages claim for breach of contract, if that were to occur, on the other. Now, the former is of course what ought to happen. We ought not to be exposing recipients to litigation or the threat of litigation, saying, ' Well, it's okay because we'll indemnify you.' Anyway, I will get to the bottom of this, Chair.

CHAIR: Thanks.

Senator O'SULLIVAN: Chair, can I just—

CHAIR: Senator Wright has one more follow-up question.

Senator O'SULLIVAN: It is absolutely timely, on the minister's comment. I have not heard you say that they are indemnified. I have heard you say that you will work with them to try and manage the situation.

Senator WRIGHT: That was my question.

Mr Grybowski : There is at least one organisation that welcomes the opportunity because it sees that it is more appropriate for that particular organisation to—

Senator O'SULLIVAN: You can clear up my statement very quickly. Are they indemnified, as a layperson would understand that term in law? Are they indemnified—meaning you will pick up the obligation, notwithstanding the circumstances?

Mr Grybowski : Yes.

Senator WRIGHT: I will come back to my question. There are two different strands to the indemnity question. One is: are they going to be indemnified if they are actually subject to suit and contractual damages? The other one is: you have indicated programs that will be facilitated to continue if they have entered into contractual arrangements with third parties. The other issue I have is the effect on staff and staff employment and the contracts there. The question I was going to ask, finally, was: given the structure that you have talked about and the restructuring, was there any consideration given to grandfathering these particular organisations to enable the contractual arrangements to have been met and then bring them into the new structure at the end of the six years? That would seem to me to be a sensible, logical and fair thing to do.

Mr Grybowski : We did not undertake this reform lightly. We deeply considered the options presented to us. So, yes, that was considered.

Senator WRIGHT: Why wasn't it taken up?

Mr Grybowski : The situation we are in at the moment through history, across seven art form boards and several categories of arts organisations, the review process, the acquittal process and the assessment process is that, basically, reviews were happening every year. The sector that is now working in an incredibly different way and across art forms was disadvantaged by the funding mechanisms that had developed over time. So an organisation working in theatre and dance could not come to us and apply for six-year funding because we said it was only three-year funding, or the dance board was assessing in one year and the theatre board was assessing in another year. So, to clean that up, to provide a transparency and a consistency across all the art forms, to recognise that the art sector is working in incredibly different ways, we had to find a clean and transparent mechanism and assess all the organisations at one particular time. In terms of distributing honours in excess of $20 million each year to this group of companies, we felt that that opportunity would better respond to the needs of the sector and support that sector so that we could then provide those ongoing contracts so that they could then basically get on with their work, leverage funds from other tiers of government, the philanthropic sector and the private sector.

Senator WRIGHT: Given this precedent, can you understand why other arts organisations, even if they enter a contract for three years, might not have some concern that that may be unilaterally changed as well and that they may act on the basis that they have a certain period of funding and then they have it changed. My point was: why not, in this case, allow that extra three years to it, then grandfather it and then bring them into line with the others?

Mr Grybowski : I think explaining the significance and scale of these reforms in our grants area when moving from 140 categories, with over 300 criteria which had developed over time, to common criteria and five grant categories is a significant simplification and streamlining of the process. Over the 40-plus year history of the organisation, this is the first time that we are implementing this reform. In an equal way, the complexity of the support for arts organisations had built up seven different categories and two tiers of small- to medium-organisations et cetera; we had to clean that up. We felt that this was an opportunity to clean up the complexity and provide transparency and simplicity. In the review of the Australia Council several years ago, the message from the sector was loud and clear to clean up this complexity and provide equal access and opportunity.

CHAIR: Can you on notice give me the list of those 14 organisations?

Mr Grybowski : Certainly.

CHAIR: Can you tell me—as a senator, we are responsible for our own state—which ones were in Queensland that were impacted—

Mr Grybowski : Yes, I can. Of the key producers—

CHAIR: of the 14. There is one from South Australia, which Senator Wright has rightly raised.

Senator WRIGHT: I think there is only one from South Australia. You can correct me, if I am wrong.

Mr Grybowski : There is one from South Australia. I do not have the list in front of me—if I can take that on notice.

CHAIR: Can you think of one in Queensland that fits the 14?

Mr Grybowski : The Queensland Music Festival.

Senator Brandis: That is the Townsville chamber music festival.

Mr Grybowski : No, it is the Queensland Music Festival.

CHAIR: I was going ask that, Minister, because my questions are about the Townsville festival, but it is not that one.

Mr Grybowski : No, it is based in Brisbane but works in the community space across regional Queensland.

CHAIR: What is it? Is it a community organisation?

Mr Grybowski : It is music focused but it works in community cultural development activities actively engaging with its community.

CHAIR: Who is it though? Is it just a community fund?

Mr Grybowski : No, it is a professional arts organisation that has a long history based in Brisbane but increasingly working across regional Queensland.

CHAIR: But it is not government or a set-up by Opera Queensland?

Mr Grybowski : No. It is one of the 147 what we call key organisations or small to medium companies that is based in Brisbane, working in regional Queensland.

CHAIR: You talk about implementing reform. What is your reform—I do not want you to go into that in detail, but when did this reform realignment process start?

Mr Grybowski : With the enactment of the Australia Council Act 2013, which came into power on 1 July last year.

CHAIR: What did that act say? Again, I do not want you to tell me every clause, but what is the thrust of it?

Mr Grybowski : It moved from an enshrined art form board structure, where the government of the day appointed the members to each of seven art form boards—eight or so members on each—to a skills based board where the government appoints the 11 members of the governing board, which authorises the activities of the Australia Council. The board then appoints a pool of peer assessors, export artistic assessors, from right across the country, from which we draw into appropriate panels to assist us with our funding decisions.

CHAIR: So there was a new board appointed from 1 July 2013.

Mr Grybowski : Correct.

CHAIR: Who is heading that?

Mr Grybowski : Rupert Myer is the chair.

CHAIR: Where would I find the list of the board members?

Mr Grybowski : The list is in the annual report and on our website.

CHAIR: So they are all appointed by the government prior to 1 July 2013. What sort of process—do you know?

Mr Grybowski : They were appointed by the minister of the day.

Senator Brandis: I might say, Senator Macdonald, that I did entreat the minister and Mr Myer—not that he had the final say—not to appoint the board of the principal cultural administrative body in the country in the shadow of an imminent election, because I did want to protect the Australia Council from the suggestion that it was political. But those entreaties were not successful, and the full board was constituted shortly before the Labor government went out of office.

I expressed concerns at the time, both about that and about the selection of members of the board. I expressed concerns that none of them, in any authentic sense, could be said to come from regional Australia. The only person who came from regional Australia, I think, was said to come from Geelong, although his business address was in central Melbourne. But in any event it happened, the election happened and the government is getting on with working with the Australia Council. The government has confidence in Mr Rupert Myer—great confidence, in fact, in Mr Rupert Myer. If the way in which a new board was constituted was done with indecent haste and in the shadow of an imminent change of government, well, that is not really the fault of the Australia Council.

CHAIR: I appreciate that minister, and thanks for that. I was going to ask those questions. I am told that we are 15 minutes over for our morning tea break and we must work to the rule! But I do want to come back to this. Just finally, on that aspect—and perhaps I will come back to the appointments generally—I assume that the secretary and very few of the senior public officials were around at the time. And I certainly would not ask you, Minister, about the procedures of a previous government, except to ask: when were these appointments made and over what period of time was the process? Were people invited to apply or was there a process?

Senator Brandis: I do not know what the process was, although it is fair to say that many members of the board who were reappointed as from 1 July were pre-existing members of the board and then there were some new members appointed as well.

CHAIR: Okay. And this rearrangement—this reform situation—happened as a result of the decisions of the new board?

Mr Grybowski : They were recommendations from the Australia Council review of 2012.

CHAIR: Which was conducted by?

Mr Grybowski : Gabrielle Trainor and Angus James.

CHAIR: Okay. We might pursue this a bit later on but we will now break until just a fraction after 11.00 am.

Proceedings suspended from 10 : 47 to 11 : 03

CHAIR: Mr Grybowski, anyone who follows parliamentary debates or the media would have seen that I have been very unhappy about the treatment meted out to the Townsville festival of performing arts, a festival in its 25th year. It started off very modestly but now has a worldwide reputation. It also has great community involvement during the festival, with concerts three times a day, a winter school program, various involvement with school communities and various involvement with the Palm Island Aboriginal community. It is a wonderful organisation and a wonderful event. It gains a lot of its funding from its own sales—and these have increased over the years—but it has always received money from the Australia Council, and it used that money for specific purposes to enhance the reputation and the value of the festival. Could you explain to me what funding it has received in recent years, and what was the rationale behind the decision to stop funding in this, its 25th anniversary year, the year of major celebrations of its longevity?

Mr Grybowski : Thank you for the question. I should start by saying that I agree with you on those points about the festival. I have attended it twice. In my previous capacity as the general manager of the Australian Youth Orchestra, we participated very actively in it, and I also attended as an audience member. I was in Townsville last week. I had a three-day visit to Rockhampton, Townsville and Cairns, and I met specifically with Sue Hackett, the general manager of the festival. Obviously, talking to other community and arts leaders in that region, the importance of that festival is well known. The Australia Council does have a funding agreement with the organisation until the end of this year and has supported it in excess of $500,000 over that life cycle.

CHAIR: What is the life cycle?

Mr Grybowski : Since their first application.

CHAIR: Over 25 years?

Mr Grybowski : No. It is not over 25 years. I think over about the last eight years—eight or nine years. I will check the specific date.

CHAIR: I had hoped you would be very well prepared with this, because I have spoken about this in the parliament, and I have issued press releases. In fact, in my speech in the parliament, I think I said that I hoped someone from the Australia Council was aware of this, because I was going to question them at length at the estimates hearings. I am pleased to see that, at least a week before the estimate hearings, you have been up to see Ms Hackett. I have not caught up with what the festival people think about your visit.

Mr Grybowski : Our staff in the music area have been in regular contact with the festival, and we have a very active relationship in supporting them. Sue Hackett confirmed that they are putting in an application in the current music round which closes this month, and the decisions will be made early next year. We feel very confident that that organisation will be supported. In addition, following the public and sector consultation last week, that organisation has access to the new funding support through the reformed organisations funding and grants programs which I have described—

CHAIR: But, Mr Grybowski, didn't Ms Hackett tell you that, to be able to organise a festival next April, they need to know now what money they can have to get in world-class artists, or whatever they do with their money? I am no aficionado or expert in this, but I can understand these basics: if you are running a festival in April, you have to know now, not in February next year. It is a bit late then to be given some sort of a grant. Was that explained to you?

Mr Grybowski : It was. And we provided the transition funding for this particular year, and there is the opportunity for them to put in an competitive application. In that last round—

CHAIR: What is the transitional funding ? Sorry to interrupt you, but what is the transitional funding?

Mr Grybowski : It was funding of $50,000 for this particular year.

CHAIR: The calendar year or financial year?

Mr Grybowski : The calendar year for 2014.

CHAIR: That was for the 2014 festival.

Mr Grybowski : Correct.

CHAIR: We are talking about 2015, the 25th anniversary festival.

Mr Grybowski : Which will be the subject of the application that is currently being put in to us, which will be assessed early in 2015.

CHAIR: But they have missed out on the one that would normally be announced about now, haven't they? That would have allowed them to get a world-class artist.

Mr Grybowski : They were unsuccessful in their application in May. It was around when four other Queensland-based arts organisations were successful. Since that time, understanding the importance of that festival and the support that we needed to give, we have worked incredibly closely with the festival to ensure that the application that is submitted this month will be successful when assessed by the peers early in 2015.

Senator Brandis: Can I say something to you, Senator Macdonald?

CHAIR: Yes, Minister. I want to follow that up—

Senator Brandis: I do not want to interrupt, but as a Queensland senator and as somebody who has taken a close interest in Townsville Chamber Music Festival having attended it twice now, including this year, I have made my view very clear to the Australia Council that it is the government's wish, and it is my wish as the minister, that that music festival continue to be supported. Now under the Australia Council Act, the government, the minister, cannot give a direction to the Australia Council in relation to any particular funding proposal, so I cannot direct the Australia Council to approve an application. But let me take the opportunity of this forum to make it very clear that it is the government's very strong wish that the funding application be approved. The Townsville Chamber Music Festival—and I speak not only as a Queensland political representative but also as a lover of chamber music—is plainly the principal chamber musical festival in Australia, it is one of the principal music festivals in regional Australia and it will be completely untenable for it to not continue to be supported by the Australia Council.

CHAIR: Thank you, Minister; I appreciate that comment and your support. Regrettably, as you rightly tell us, the decision is not yours, but thank you for making your view and the government's view known. Mr Grybowski, you said that the application is coming and is going to be assessed, but you are going to guarantee they are going to get it anyhow—which I am delighted about. Assuming that it is around the same amount that was given in previous years—that is around $60,000 I think—I will perhaps say to the festival that they can take your public guarantee here that they will be funded as a guarantee of funding so that they can commit themselves now to that expenditure for a special event or a special thing or whatever they do—a special person—for their 25th anniversary. Do I assume that it is going to be in the order of what they applied for, which I think was $50,000?

Mr Grybowski : I have not personally reviewed the application as yet, but part of my discussions with the organisation last week was about encouraging the highest ambition for their application to the new funding programs next year as well.

CHAIR: So you are telling me that you are going to surprise us with more than $50,000?

Mr Grybowski : It is the responsibility of the organisation to articulate their ambition and to put a viable budget to us for assessment.

CHAIR: Well it has managed to do that for 25 years. I wonder what happened this year?

Mr Grybowski : It has, and over that history the Australia Council, during a period of difficulty that the organisation faced, supported it and rolled its funding over so that that organisation could re-establish itself and stabilise itself, which it has done incredibly successfully. In these discussions with myself and with our staff, we have provided it with the best advice so that it is competitive and can continue to operate effectively in that region.

CHAIR: The festival is a meeting place for outstanding talent, potential and enthusiasm and was designed primarily for vocational students and exceptionally gifted young amateurs and the Winterschool provides top-up level tuition. So it is not just a festival; it is a festival in all of its senses. The teachers at the Winterschool are festival artists themselves. I am so impressed by the fact that they have family concerts, individual concerts and breakfasts and they have guest artists going to the Kirwan State High School, the Pimlico State High School, Townville Grammar, the North Queensland Recorder Society, Mackay Handbell Society, and Amadeus Singers. Impressively, they do work, I understand in the sometimes difficult community of Palm Island. I understand they go down the mines for concerts. It is total community involvement—which I thought the Australia Council was supposed to be supporting.

Mr Grybowski : As I said, I have witnessed some of the community impacts and engagement that you have described personally. It joins a number of organisations that have similar successful community engagement. The Castlemaine State Festival, for example, is another one that plays an incredibly important role.

CHAIR: Which one?

Mr Grybowski : The Castlemaine State Festival, which is in Victoria. I acknowledge the important role it plays, along with a number of other regional festivals in regional Australia.

CHAIR: So why did they not succeed this year in the application for their 25th anniversary celebrations? Who makes those decisions—the board, is it?

Mr Grybowski : There is a panel of music experts. Funding sought from us is incredibly competitive.

CHAIR: I appreciate that.

Mr Grybowski : We have an average success rate of about 18 per cent to 25 per cent.

Senator O'SULLIVAN: I do not mean to interrupt, but that was not the question. I am interested in the answer to the question about why in this particular case the application was not successful.

Mr Grybowski : There was an unprecedented volume of equally excellent applications, including four organisations from Queensland that were competing within that particular group.

CHAIR: Four approaching their 25th or 50th anniversary, I suspect?

Mr Grybowski : Possibly older than that. The Queensland Youth Orchestra, the Queensland Music Network—

CHAIR: You have always funded the Queensland Youth Orchestra.

Mr Grybowski : the Camerata of St John's—

CHAIR: You have always funded them.

Mr Grybowski : Again, in competitive funding rounds, unfortunately, there are some which—

CHAIR: But you have funded those organisations in the past, as you have done with this one, and suddenly one drops of the list in their 25th anniversary. My question was: who made the decision? How is the decision made?

Mr Grybowski : There were six peers assessing the applications, including two peers who were from Queensland.

CHAIR: Can you tell me what 'peers' are? I am sorry, but I do not understand the term.

Mr Grybowski : The peers are the artistic experts. They are people who are current practitioners, who are musicians—

CHAIR: Who appoints them?

Mr Grybowski : Those peers are appointed by the board of the Australia Council.

CHAIR: Are they always the same, or do they change every year?

Mr Grybowski : One of the criticisms of the previous board structure under our old governance structure is that there was too much responsibility in a few and there was not diversity or representation geographically from within those boards. The new way that we construct the panels assessing these applications is to ensure that, when there are Queensland based applications, there are Queensland based peers on that panel making the assessment, so that there is a familiarity and an understanding of the context in which those arts organisations are actually working.

CHAIR: So these peers are from what locality geographically?

Mr Grybowski : I do not have a list of them in front of me, but two of them were from Queensland.

CHAIR: Two out of how many?

Mr Grybowski : Two out of six.

CHAIR: Two out of six—dealing with just Queensland grants, or was this Australia wide?

Mr Grybowski : The applications were received nationally.

CHAIR: Okay, so two out of the six nationally. Perhaps I can get some advice from the secretary here: could I ask for the names of those people so I can assess where they come from or what their allegiances might be.

Mr Grybowski : Sure. They are publicly available, in the interests of transparency of the process.

CHAIR: And the two Queensland ones are geographically from Brisbane, I guess.

Mr Grybowski : I do not have the names of them, but I will take that question on notice.

CHAIR: Okay. I would have hoped that you might have had all this information, in view of my public advice to you that I was going to question you about these things. Anyhow, we will take that on notice. These six people were newly appointed just for 2014, were they?

Mr Grybowski : The peer panels are formed to assess a particular grant round, and we have a mix. So they are appointed for that particular round.

CHAIR: And they are actually selected by the board of the Australia Council?

Mr Grybowski : They are approved by the nominations and appointments committee, which approves the pool of some 650 people—experts from around the country who form the pool. Then we draw from that pool to ensure that we have a mix of diversity and expertise.

CHAIR: And geography, no doubt.

Mr Grybowski : And geography and expertise. These two particular ones, because there are a number of classical music based applications, did have expertise in classical music.

CHAIR: Do they give written reasons for why they were rejected? Do they get back to the organisation and say, 'You were rejected because you don't have the required community involvement?

Mr Grybowski : There are a range of specific criteria. The peers assess the written application—so what is written by the organisation—against those criteria, and they also assess a range of support material. All the applications are treated in that way, and then those applications are ranked. It is often the case that there is angst for these peers—artists themselves—making these decisions. Because the budget is limited, they have to not fund or support a range of excellent applications, which is common in absolutely every round.

CHAIR: My question was: do they give written reasons for why they rejected it?

Mr Grybowski : We provide an acquittal and an assessment report, and those discussions and that feedback have been provided to the Townsville chamber music festival so that that organisation can work with that feedback to ensure that the application that it is currently submitting will be successful.

CHAIR: In this instance, can you tell me—I do not need it to be chapter and verse—basically what the objection was? Just that there were other applications that were better?

Mr Grybowski : Correct.

CHAIR: But no comment on why they were better, this being the 25th anniversary and given their quite exceptional community involvement. I challenge anyone to tell me a festival of this type that has greater community involvement—greater involvement with the schools, the Indigenous community and the community as a whole. I wonder if your assessors are qualified to look at those aspects. Anyhow, that is a—

Senator Brandis: I might be able to help Mr Grybowski. I have read the report. I was a bit sceptical myself. One of the grounds advanced was that there was not a sufficient weight towards new work. Given that there are not too many 17th or 18th century composers still producing new work, that did seem to me an odd reason.

Mr Grybowski : If I could add a comment, the problems with this highlight the inflexibility of the existing grant program within which we are working and hence the importance of the reforms—for an organisation as important as this not to be assessed because of its community engagement, for example. Under our new grants model, there is the option for the organisation to select the criteria—new work, community engagement, or international access—that best would meet the purpose and the effectiveness of that organisation. So this problem, which is highlighted under this circumstance, will be addressed under the new grants program.

CHAIR: My understanding from people who know much more about this than I do is that the festival performs over 120 works each year, ranging from new commissions to crossover to new world and jazz, as well as core chamber works. I know this personally that it is known and respected nationally and internationally for its range and depth of programming, yet your assessors seem to have a different view.

Mr Grybowski : Again, it is in the context of the other excellent applications that was being assessed against.

CHAIR: Which of the other applications hadn't previously been funded by the Australia Council? You mentioned the Camerata, which is an excellent organisation. I know that the Queensland minister would ostracise me if I didn't say that.

Senator Brandis: You wouldn't not say that—

CHAIR: It is an excellent organisation; you are right, Attorney. And there is another one you mentioned, which I am pretty certain has always been funded. So which ones haven't been funded?

Mr Grybowski : The Queensland Youth Orchestra, the Queensland Music Network Incorporated and the Brisbane Multicultural Arts Centre.

CHAIR: You tell me—let me not just guess—which of those have been previously funded by you?

Mr Grybowski : I do not have that information. I will have to take that on notice. I do not have the funding history of those.

CHAIR: It looks like your assistant might know that.

Mr Grybowski : No, we will have to take that on notice.

CHAIR: Let me put it to you that all of them have previously been funded.

Mr Grybowski : While having to confirm that, I believe that to be the case.

CHAIR: So there are a lot of other good applications and all of them were successful, but this internationally renowned festival in its 25th year did not get funding. Do you stand by the assessments of not your peers but the people you call peers?

Mr Grybowski : The importance of the peer process and the independence of that process is important. Obviously, it is where we are implementing these reforms and have moved from fixed music boards to a larger pool process. We are obviously evaluating it to ensure that the very best system is implemented.

CHAIR: The other ones in Queensland—and if my limited knowledge serves me well—are all based in Brisbane. I suspect, after seeing a list of your other grants, that the other competing grants are all based in capital cities. Would that be a fair assumption?

Mr Grybowski : I will use Camerata of St John's as an example. Although they are based in Brisbane, their regional and touring engagement is, as I understand, extensive.

CHAIR: I can guarantee it. They even came to my little home town of Ayr and performed in a wonderful theatre we have there, which, I might say in my own praise, was built when I was on the council there. It is a marvellous thing, and the Camerata have been there. Wonderful. Good. But they are based in Brisbane, as is, I suspect, every other one that you have mentioned. I do not know all of them.

Mr Grybowski : There are two other organisations in Townsville that I would like to highlight, who are supported through our key organisations and who, again, have the increased opportunity for six-year funding as part of that assessment next year. Dancenorth has been allocated a total of $902,885—

CHAIR: They have always been funded, and thank you for doing that. It is a good organisation. It is a good group.

Mr Grybowski : Umbrella Studio Contemporary Arts is another very successful organisation.

Senator Brandis: Although it should be said in fairness, Senator Macdonald, that the decision in relation to dance would be made by a dance panel and a decision in relation to the other would be made by a different panel. So the question of funding the Townsville Chamber Music Festival, which would be made by the music panel, would not involve the same decision makers as made the other two decisions in relation to Townsville based arts organisations.

CHAIR: Thanks for that. That is sort of the point that I am getting to. That is a different program to the one that you are talking about, is it?

Mr Grybowski : It is a different program, correct.

CHAIR: Whilst the Camerata and the youth festival do tour, I am sure, they are based there, which means that their performers come principally from the capital cities. Whereas with the festival, certainly, a lot of them are visiting and come from Australia and from many capital cities, but there is a substantial local element in regional Australia.

Mr Grybowski : That is correct. In excess of $120 million goes to the suite of arts organisations: the major performing arts and a few organisations who, while many of them are based in metropolitan or city locations, tour incredibly extensively across regional Australia.

CHAIR: But do you not get my point? If they are based there then that is where their performers come from—principally. Some will fly down from Townsville or Cairns and move to Brisbane to be part of it, or move to Sydney: I accept that. But the idea of equality in access to the arts involves more. Surely, just because you live in regional Australia you are not prevented from—

Mr Grybowski : The Australia Council, under its new strategic plan and in the past, has a major commitment to supporting regional artists, wherever they live, so that they can make good work. I will use this example: last Friday at 11 o'clock in Cairns we held a public forum for artists to explain the opportunities for these new grant programs. I think in excess of 50 artists turned up to that. It was one of the largest forums in a regional centre that we have held recently.

I asked at the start of that forum how many people had applied and how many had received funding. In excess of half—about three-quarters—of those present had applied and about half of those had received funding, demonstrating the depth of talent across this country.

CHAIR: And what sort of funding is provided to that half of three-quarters?

Mr Grybowski : Across the range individual groups of artists—

CHAIR: Do they get a couple of thousand dollars to do a particular event?

Mr Grybowski : Or there is a number of small arts organisations up there. So it was the full—

CHAIR: How many major organisations—apart from the one that you and I both shared a platform on recently? The minister kindly asked me to attend the Indigenous festival—

Mr Grybowski : The Cairns Indigenous Arts Fair? Exactly.

CHAIR: Yes. It is very—

Mr Grybowski : I met with that organisation. They are about to appoint a new artistic director. We have a three-year commitment to ensuring that that festival—

CHAIR: Well, I am glad you have given them a three-year commitment. And this major, 25-year-old festival has got zero—zilch.

Senator Brandis: I can provide you with some additional information in relation to some of the questions, which I have in a briefing note provided to my office by the Australia Council on 7 October. I will read from the briefing note and I will table the document. It says—and I am not reading the whole note, I will just read relevant paragraphs: 'The Australian Festival of Chamber Music has been funded as an Australia Council key organisation since 2009. In May 2014, the Australian Festival of Chamber Music applied to the music program grant round for $50,000 annual program funding but this application was not successful. The panel considered that the proposed program was not strong on providing direct benefits to the artists and art form.'

It goes on to say, 'In assessing the Australian Festival of Chamber Music key organisation's application for 2014-16, the panel did not consider the organisation's artistic program to be competitive in the round, nor did they consider that the Australian Festival of Chamber Music presented a strong case within the key organisations framework as either leading innovators that consistently stretched their art form practice and/or an acknowledged centre of excellence in their particular art form practice. It was resolved that a year of funding at the current level would be offered in 2014 to assist the Australian Festival of Chamber Music to exit the key organisations category.'

I am bound to say, having attended the 2014 Australian chamber music festival, it is incomprehensible to me how anyone could conclude that it did not represent excellence in its particular art form practice—that is, chamber music. I am also told by the briefing note that the grants programs for music organisations in Queensland are, for 2015: $45,000 to the Brisbane Multicultural Arts Centre, $50,000 to the Camerata of St John's, $50,000 to the Queensland Music Network, and $50,000 to the Queensland Youth Orchestra. I will table the full document I am reading from.

CHAIR: Thank you. I am delighted that those other ones have funding, but my question—you can take it on notice—is: how many of them have always got funding? Tell me about the Queensland Music Network. Is that a new one or has it been around for a while? Sorry—I am not from Brisbane, so I do not know.

Mr Grybowski : I will take that on notice.

CHAIR: And the multicultural one—is that new funding?

Mr Grybowski : I will have to take that on notice.

CHAIR: I do not want to take too much more time on this. Mr Grybowski, I know you have been to Cairns. You told me you were in Townsville last week and you told us you took the Queensland Youth Orchestra there. When was that?

Mr Grybowski : No, the Australian Youth Orchestra. I was general manager for seven years and we undertook extensive regional touring, including performances at—

CHAIR: When were you in Townsville?

Mr Grybowski : I would have to check. In 2001, 2002—something like that.

CHAIR: Since then, and before last week, when did you last go to Townsville and the Festival of Chamber Music?

Mr Grybowski : I have not personally been since that time, but I attended twice around that period. Representatives of the Australia Council, including the director of music, attended the 2013 festival.

CHAIR: Have you had a chat to your director of music? Did he or she think it was a pretty good festival?

Mr Grybowski : We agree that it is. We also acknowledge that the festival has gone through significant change and development. Again, since that application in May, we have been working incredibly closely with the festival so that it will be competitive in the next round. The peers assess what is written in an application by the organisation. While we can assist and help that organisation, it is ultimately the responsibility of the organisation to articulate in its application.

CHAIR: Yes. I am aware this festival did go through some troubles, even to the extent where—perhaps I should not say this—I was having to do photocopying for them in my office. It must have been with paper that I had bought myself, not government issued paper. So I know that at that time they had to rely on charity just to do their photocopying. But since then they have certainly had a new approach.

Mr Grybowski : They have, and they are in a very stable position.

CHAIR: They are world renowned. I was recently overseas and someone said, 'Where do you come from?' and I said, 'Townsville.' 'Oh, that's where that festival is.' It has world recognition. Thanks for that. Can I just be clear on your guarantee. I do not want to embarrass you or hold you too much to this—well, I do, actually.

Senator Brandis: You mean hold him, not embarrass him!

CHAIR: I am sure, Mr Grybowski, you would have heard from Ms Hackett—and you know from your long experience—that to plan for next May you have to know now so you can ring an international artist from New York, London or Vienna and say, 'Hey, come out. We'll help you get there.'

Mr Grybowski : Which is absolutely the rationale for why we are moving to more stable, six-year funding for our arts organisations—and I hope that when I am sitting in this room at the next estimates we will be able to confirm a very successful outcome for the festival.

CHAIR: Not only will I confirm it but I will roundly congratulate you if I see that the Festival of Chamber Music in Townsville have received funding to help them in this, their 25th year. I cannot believe the insensitivity of whoever made the decision. If they were going to chop them out, fair enough, but not in the year of their 25th anniversary, surely.

Mr Grybowski : I look forward to experiencing the festival personally next year too.

CHAIR: Well, Mr Grybowski, if you went there in the current situation, you would probably be hung, drawn and quartered! I appreciate you are not the only decision maker. But I hope that, by next year, you will be everyone's hero and much loved because you have done the right thing by that organisation. I cannot ask you to prejudge applications, but you are saying that you feel fairly confident that you can give a solid indication to the festival that they will be considered in the February grants?

Mr Grybowski : Yes.

CHAIR: And I want to make sure that you are not just talking about the $30,000 and that you would give something like you have given, rightly, to the camerata and the Queensland Youth Orchestra and all those sorts of organisations.

Mr Grybowski : We will assess the application that the organisation puts in—and I imagine they are putting in for $50,000—and we will also be working with them on their expression of interest for the six-year funding, which closes on 3 March next year.

CHAIR: Thank you very much, Mr Grybowski. I am really looking forward to the next estimates session, when a lot of this can be confirmed. Senator O'Sullivan, did you have anything you wanted to follow up?

Senator O'SULLIVAN: I have a few questions. But I would like to note the arrival of Senator Bullock. Joe and I would probably be the two senators, outside of the minister, who are the most interested in the arts! So, welcome, Joe.

Senator WRIGHT: I do not know about that! All of us are.

Senator O'SULLIVAN: I just want to revisit—

CHAIR: For Hansard, this is the trouble, Senator O'Sullivan. When people read that—

Senator O'SULLIVAN: Do you think they should put 'grinned' in brackets or something!

CHAIR: And Senator Wright and others—

Senator WRIGHT: And Senator Leyonhjelm too, I think.

CHAIR: would challenge you.

Senator Brandis: I am sure Senator O'Sullivan and Senator Bullock have the most reliable taste!

Senator WRIGHT: I would not even assume that, Senator Brandis!

Senator O'SULLIVAN: I just want to revisit the chair's line of questioning. I think we can tidy some things up fairly quickly. With this peer group of six people, I imagine that, as large and wonderful as our country is, it would be very difficult for anybody in the arts not to have during their career formed allegiances with or support for particular groups or elements within the arts community. It is just a general question.

Mr Grybowski : Correct. The peers are selected because of their professional expertise, practice networks and knowledge of a particular area.

Senator O'SULLIVAN: Sure. So, when you bring six peers together to make these determinations in this very competitive environment, I am interested in what your governance arrangements are to see that conflicts of interest are dealt with. Do they vacate if they have had, for example, an association with one of the applicants?

Mr Grybowski : The governance structure, arrangements and protocols around this decision making are incredibly strong; and, again, through these changes and reforms, we have reviewed those protocols. The declarations of interests, of perceived or real conflicts of interest, is absolutely at the start of the meeting. Again, when the staff of the Australia Council assess the applications that we receive against the criteria to ensure that they are eligible for assessment and understand what the makeup of those applications is, they appropriately form a panel that is skilled and equipped to assess those grants.

Senator O'SULLIVAN: Okay. So the six peers in relation to the specific case the chair raised, I imagine, attend the festival to experience it as part of their due diligence process as to whether the festival's application has merit.

Mr Grybowski : We select the peers for their expertise and knowledge of the art form sector. As we are assessing grants from every part of the country and while we draw our peers from a national pool, it is not possible to ensure that every peer sees the work of every organisation. But, where possible, peers are selected to ensure that art form practice, region or area—and again, knowing that peers working within a community understand and hear amongst their networks about the practice of other artists.

Senator O'SULLIVAN: The burden of my question went, obviously, to this specific case. Are you aware whether all or any of the peers attended the 2014 festival to experience the event as part of their due consideration?

Mr Grybowski : I am not. All I can say is—I can get the specific details—two of the peers were from Queensland, and two had specific classical music expertise.

Senator O'SULLIVAN: You might take my question on notice, because it is very specific. It follows then, in a general question: as part of this due process, wouldn't you think it would be useful for one or more of the peers, in a very organised way, to attend so that they could report to their colleagues about the quality or standard of the operations of a particular festival.

Mr Grybowski : When a round closes, we actually do not know what we are going to receive. As we are assessing many thousands of applications in different categories from across the country, it is practically impossible—and, again, it is the timing of particular events—to get peers to actually attend a particular festival. That is why the process of ensuring that art form expertise and people from that particular art form are put on the panel so that there is the best expertise around that table.

Senator O'SULLIVAN: What part do you play in this, Mr Grybowski? Do you sit with the empanelled group?

Mr Grybowski : The staff of the Australia Council do not make grant decisions.

Senator O'SULLIVAN: You know what? There are only so many hours in the day. I would like you to concentrate on the element of my question. We can dispose of some of these very quickly. Do you sit on the panel?

Mr Grybowski : No.

Senator O'SULLIVAN: Do any of your staff sit on the panel? I do not mean in a voting form, but as a resource for the panel.

Mr Grybowski : Yes.

Senator O'SULLIVAN: They do. Do you sit as a resource for any of the panels?

Mr Grybowski : No.

Senator O'SULLIVAN: You do not. What is their resource role? Do they provide advice; do they answer questions; do they conduct research? Is there a preparation brief that goes beyond the application itself?

Mr Grybowski : The role of the staff is extensive. They receive the applications, ensure that they are eligible against the criteria and ensure that all the applications go to the peers for assessment and for scoring. They then facilitate the live meetings—coordinating the actual assessment—and then ensure that the meetings are actually run according to our governance guidelines.

Senator O'SULLIVAN: In the 'briefing notes', we will call them—

Mr Grybowski : They do not receive briefing notes.

Senator O'SULLIVAN: Give me a name, and I am happy to go with your name—the package of resources that the peers receive. There is an application—

Mr Grybowski : The resources are the applications from the artists making the application.

Senator O'SULLIVAN: With zero intel provided from your organisation?

Mr Grybowski : There is no assessment.

Senator O'SULLIVAN: No, that is not my question.

Mr Grybowski : Other than, 'Yes, this meets the selection criteria.'

Senator O'SULLIVAN: The sole contribution of your staff is to indicate that it technically meets the approval process?

Mr Grybowski : They provide a response to questions from the panel. They provide verbal advice on any contextual issues—is the organisation viable; are there historic elements which would help them in their decision making?

Senator O'SULLIVAN: That is a particularly interesting question. How would your staff know about the contemporary viability of any one of these thousands of applicants? I imagine that is an enormous job.

Mr Grybowski : Correct. That is what the role is—to understand that.

Senator O'SULLIVAN: Are you telling the committee that your staff perform financial due diligence of applicants when there are thousands of them?

Mr Grybowski : Many of the applications we receive are from individual artists, so that type of financial analysis is not undertaken; it is more based on the support material. But for the arts organisations, where substantial amounts of money are being sought, the financial history is undertaken by a team of staff who have a relationship with that organisation.

Senator O'SULLIVAN: Let us capture this now, and I will not spend a lot of time on it—

CHAIR: Senator O'Sullivan, I do not want to curtail you—and under the new standing orders pushed through the Senate I cannot stop you asking questions all day—but I would remind all senators—

Senator O'SULLIVAN: I am trying to help the Townsville mob here, Chair.

CHAIR: I am just being a fair chairman. I remind all senators that we have a lot to go through, but I cannot stop you, Senator O'Sullivan; go for as long as you like.

Senator Brandis: I do not think that chamber music has ever had such a hearing at a Senate estimates committee here before. This is positively delightful.

CHAIR: Only if it gets the result, Minister.

Senator O'SULLIVAN: No-one wants to see you cranky, Senator; that is not a pretty sight. You may have to take this on notice. I am keenly interested—and this is a common question of mine and you need to prepare yourself for future events. From a governance perspective, do you record when any panellists—in this case we are calling your panellists that come together a peer group—declare that they have a conflict?

Mr Grybowski : Yes.

Senator O'SULLIVAN: Would you be able to provide us with data, because I have got to imagine that that is an absolute minefield. I would be surprised if you had a peer group who on every occasion, or every second occasion, did not declare that they had a conflict. What do you do with the peer member who declares? What are the guidelines for the peer member who declares they have a conflict?

Mr Grybowski : Then they are removed from the assessment of that particular applicant.

Senator O'SULLIVAN: As a general question, given there are thousands of applicants, there would be a bit of breeze coming off the door here, would there?

Mr Grybowski : We try to match the—

Senator O'SULLIVAN: No, the question is—and you may not be able to answer it—is this frequent?

Mr Grybowski : I will take that question on notice.

Senator O'SULLIVAN: But you are the CEO. You are probably somewhere else in the building. Do you go past the tearoom and there are mobs of peers waiting to go back in?

Mr Grybowski : There are peers who—

Senator O'SULLIVAN: I will tell you what, I am going to take up my time until we get there. We can go the long way or the short way. I am asking you, as the CEO of this organisation, do you have a sense of whether this is a common thing happening? If there are thousands of applications, does this happen on hundreds of occasions?

Mr Grybowski : I would say it is not common, but it is a very important aspect to ensure that there is not conflict, and occasionally peers would have to absent themselves. The answer to the question is that it is not common.

Senator O'SULLIVAN: All right. Then you may have to take this on notice: do you keep a record of what peers are selected for which applications to process?

Mr Grybowski : Absolutely. That is recorded.

Senator O'SULLIVAN: Can you take that on notice and give me a copy of that? I do not know whether the rest of the panel is interested. I am going to have a bo-peep, because I find it extraordinary that this is not a frequent contingency that you have to deal with.

Mr Grybowski : All the assessment meetings are minuted. Any conflicts or perceived conflicts are declared and that is recorded.

Senator O'SULLIVAN: But if someone declares a conflict and says they can manage it, do you leave them in?

Mr Grybowski : No.

Senator O'SULLIVAN: We will get the facts and figures and we will have a look, because to my mind one of the biggest risks for you is the partisan behaviour of a peer on a selection panel; there is no question about that. This would be high risk, up in the red.

Mr Grybowski : That is why providing a balanced assessment panel is absolutely of primary importance when we are forming these panels—so that the bias would not exist.

Senator O'SULLIVAN: Thank you, Chair. He just said that Townsville is back on. Put it on the Hansard.

CHAIR: Thank you, Senator O'Sullivan. I am conscious that we have a big agenda, so I will not go too much further on the other issue I wanted to raise, and that is, I have seen in 2014, 28 major performing arts companies receiving a total of $148 million. I have a list of one to 28, which I assume my staff got from the annual report or from somewhere else.

Senator Brandis: Those are the AMPAG companies—the Australian Major Performing Arts Group.

CHAIR: Yes. Is any one of them not based in a capital city? Perhaps you might have to take that on notice.

Mr Grybowski : I can answer that question. There is not.

CHAIR: There is not?

Mr Grybowski : No.

CHAIR: Are there any other applications—

Senator Brandis: In fairness, Senator Macdonald, I should also point out, though, that many of them—indeed, most of them—tour extensively in regional Australia.

CHAIR: I accept that, Minister, and I, in fact, acknowledged that before. Are there applications from—if I can call them this—non-capital city performing arts groups for funding under this round? How is this list selected?

Mr Grybowski : The major performing arts group?

CHAIR: Yes, this group from one to 28. How are they selected?

Mr Grybowski : It is directed funding. It is an agreement between the Australian government with each state and territory government supporting currently 28 organisations.

CHAIR: So there is an agreement between the federal government and the relevant state governments that these particular organisations will be funded?

Mr Grybowski : Are supported—correct. The Australian government, administered by the Australia Council, supports just over $100 million and state and territory governments support the balance.

CHAIR: The $48 million?

Mr Grybowski : Yes—the $48 million through a funding framework which was initiated by Helen Nugent some 12 years ago and was reviewed and reconfirmed in 2012.

CHAIR: So this list is selected by agreement between a relevant state government and federal government?

Mr Grybowski : Correct.

CHAIR: How long has this list been there?

Mr Grybowski : It was initiated about 12 years ago.

CHAIR: Is that subject to review?

Mr Grybowski : That whole framework was reviewed—

CHAIR: Twelve years ago?

Mr Grybowski : No, three years ago.

Senator Brandis: But it is subject to review in the sense that, from time to time, some of the larger performing arts organisations may wish to be considered for inclusion on it and that is considered at the time. But these are the big Australian arts companies. There is quite a variety not just of forms but also of sizes. So you have the biggest of the lot, Opera Australia, which obviously being our biggest performing arts company, is on the list of the major performance arts companies, and then there are the relatively smaller ones; for example, since we have been talking about chamber music, the Australian Brandenburg Orchestra, which specialises in baroque music—and I see Senator Leyonhjelm giving the thumbs up. It is a very fine arts organisation, which also had a significant birthday this year, I might say. The Australian Brandenburg Orchestra is towards the lower end of the scale and correspondingly gets and in fact needs a smaller proportion of funding than the big ones.

The other important distinction to draw is between the state orchestras. Each of the six state orchestras are germinated from the old ABC orchestras of many years ago which, because the ABC is 100 per cent funded by the Commonwealth, were initially 100 per cent funded by the Commonwealth. It remains the case that the proportion of Commonwealth funding for the six big orchestras is relatively higher than the proportion of Commonwealth funding for the other 28 major arts companies.

CHAIR: I have three quick questions to finalise. The first is about the Brandenburg Orchestra—and I love baroque music. Where are they based?

Senator Brandis: They are based in Sydney.

CHAIR: On notice, if needs be, could you tell me what funding they receive? I am not so much interested in what they receive but—

Senator Brandis: We do have those figures.

CHAIR: I am interested more not so much in what they receive but a comparison.

Mr Grybowski : The Brandenburg Orchestra, $936,000 in total combined from the Australia Council at $479,000 and the New South Wales government at $457,000.

CHAIR: I must make a point of going to see them—I am sure they are excellent. They are made up of full-time musicians, are they?

Mr Grybowski : No, they are not. They come together for particular seasons and they have aspirations to expand and become a full-time—

CHAIR: How many are involved in the orchestra? Would you hazard a guess?

Mr Grybowski : About 12 core players, but they are expanding with casual players, depending on the repertoire.

Senator Brandis: I think it is right to say, isn't it, Mr Grybowski: they are far and away the smallest of the 28 AMPAG companies?

Mr Grybowski : Correct, they are the smallest.

CHAIR: Minister, you have almost anticipated me—but I am not sure that this is what you were intending—but I was going to ask Mr Grybowski: would the guidelines for being considered for this list of 28 apply to the major regional music festivals—which I will not name?

Senator Brandis: No, because that is a festival. These 28 organisations are actually arts companies, whereas the Townsville chamber music festival, like many other festivals, is a festival, so it is an event sponsored by an event promoter that brings in artists and arts companies. It is a different program.

CHAIR: I do not want to embarrass you but, getting back to the regional arts fund, would the department look at a special one-off grant for an organisation that might be having a major milestone in addition to what the Australia Council might—

Senator Brandis: We have done that: we have done that on two occasions this year; one was the Australian Brandenburg Orchestra in fact, which celebrated its 25th anniversary this year and we gave them a one-off grant; the other was the Australian Ballet School, which we gave a grant to. During the period of the Labor government, the Australian Ballet celebrated its 50th anniversary and it was given a one-off grant by the previous government, which the then opposition supported.

It is a seemly and appropriate practice on significant anniversaries to give a one-off grant to an arts organisation, and they use that for a special project or perhaps to seed capital funding.

CHAIR: If I can think of anyone that fits that category, I may—do you accept submissions from your parliamentary colleagues, Minister?

Senator Brandis: I always listen with undivided attention to the views of my parliamentary colleagues—

Senator WRIGHT: That is good to hear.

Senator Brandis: and I particularly, Senator Macdonald, if I may say so, listen with undivided attention to you.

Senator O'SULLIVAN: Indeed—as do many of us.

CHAIR: I think we might quit while we are ahead.

Senator JACINTA COLLINS: I would highly recommend that.

CHAIR: Thank you, Mr Grybowski and Mr Blackwell. I look forward to seeing you at next estimates. I remind everyone that we have a lot to go through. Does anyone have questions for Screen Australia and the National Film and Sound Archive? I see some senators asked them to be here, so we must have questions for them. Perhaps we could get them both together.