Mr FAHEY (Minister for Finance)(11.44 a.m.) —I have listened to the debate today and appreciate that there is a universal view that the subject of the AIDC Sale Bill, AIDC Ltd, is pursuing business activities which make it no longer appropriate to be maintained by government ownership. Whatever the benefit of this particular organisation when it was established—a number of speakers in the course of this debate have referred to various projects that were of benefit to the community generally in an infrastructure sense—it has long past being useful. It has lost its way somewhat simply because of the fact that there has been a deregulation of banking and there are other facilities available for the type of infrastructure that AIDC once supported.

The judgment that this business is not appropriate for government is one that has been held by both sides of the House—by the current government and by is predecessors—for a number of years. Sale measures had been initiated previously, but had not met with much success. The lessons from those previous actions have been learned and led to the legislation currently before the House which will enable this government to bring the sale of AIDC Ltd and its associated business activities to a successful conclusion.

The government will be opposing the opposition's amendments relating to the Australian Submarine Corporation holding. I made it clear during the second reading speech that the ASC holding would be quarantined from the sale. Therefore, this amendment is unnecessary.

This legislation was necessary because the existing legislative framework governing the operations of the Australian Industry Development Corporation did not provide the flexibility that is necessary to conclude a sale on satisfactory terms and conditions. In addition, despite the successful takeover proposal conducted by the corporation for the shares it did not own in AIDC Ltd, minority shareholdings in the company continued to exist for technical reasons. With the passage of this bill, it will be possible to deal with those holdings in an expeditious manner without in any way compromising the fair and equitable treatment of those shareholders. The bill clearly makes provision to protect the interests of those parties, consistent with the obligations set out in the constitution for the compulsory acquisition of property.

Another fundamental issue dealt with by the bill is that it provides the appropriate legal environment for the substantial financial interests of the Commonwealth to be managed both during and after the sale process.

A significant characteristic of the business activities of AIDC Ltd has been the added protection afforded its borrowings through the use of the Commonwealth guarantee. With the sale of the company, or its assets, the Commonwealth will continue to stand behind the guarantees that it has already provided, but in so doing it is necessary to ensure that the Australian Industry Development Corporation is provided with the appropriate legislative base to continue that task. The bill provides that base.

Concern has been expressed by the board of AIDC Ltd in relation to the power provided by this bill for the minister to require the provision of information to assist in the sale process. The concern was expressed on the basis that that may impact on the company's client relationship. I can assure the House that this power will not be used lightly by the government. The Commonwealth will be mindful of the need to protect commercially sensitive material and will ensure that commercial interests are not prejudiced during the sale process.

The bill makes provision for the protection of information obtained under this arrangement. However, it is also important to ensure that the Commonwealth's actions, as the beneficial owner of AIDC Ltd, are not unnecessarily constrained and ensure that an effective power of veto is not provided to third party interests.

In progressing this asset sale, in common with other recent asset sales, it is important for the Commonwealth to protect its financial interest and ensure that it receives full value from the sale. For this reason, the bill makes the necessary provisions to protect the sale from the imposition of stamp duty and cancels any residual franking credits that may exist in the company at the time of the sale. The approach to these provisions is consistent with provisions in other sale legislation which this House has previously passed. Similarly—and I note a number of speakers on the other side commented on this—employee interests have been protected by the provisions relating to long service leave and occupational health and safety. In other words, all the benefits that have currently accrued to the employees of AIDC Ltd will be protected through this legislation and will be passed on in appropriate circumstances to those employees.

With a maturing financial and merchant banking industry in Australia, it is important that the government progress this sale and thereby remove itself from this area of business activity. I commend the bill to the House.

Question put:

That the words proposed to be omitted (Mr Crean's amendment) stand part of the question.