Senator McKIERNAN —I present the second report of the Legal and Constitutional References Committee on the payment of a minister's legal costs.

Ordered that the report be printed.

Senator McKIERNAN —I seek leave to move a motion in relation to the report.

Leave granted.

Senator McKIERNAN —I move:

That the Senate take note of the report.

I seek leave to incorporate my tabling statement in the Hansard and continue my remarks later.

Leave granted.

The statement read as follows—

Payment of a Minister's Legal Costs: Part 2

On 28 August 1995, the Senate referred to the Senate Legal and Constitutional References Committee matters relating to the payment by the Commonwealth of the legal costs of the then Minister for Human Services and Health, Dr Carmen Lawrence.

On 28 September 1995, the Committee reported on terms of reference (a)-(e) and (h) in Payment of a Minister's Legal Costs: Part One .

The Senate extended the time for the presentation of the Committee's report on the remaining terms of reference on three occasions. The workload of the Committee did not allow it to complete the inquiry and it lapsed at the end of the 37th Parliament, following the March 1996 Election.

Following the commencement of the 38th Parliament, the newly constituted References Committee requested, and the Senate agreed, that the Committee inquire into and report on the two outstanding terms of reference, namely:

(f)   what guidelines and conditions should be put in place to ensure the legality and propriety of any use of public funds to pay the legal costs of Ministers and members of parliament; and

(g)   what is the appropriate level of reporting to parliament on the use of public funds to pay the legal costs of Ministers and members of parliament including the reasons for the decision to provide such funds.

In order to address term of reference (f), the Committee reviewed the various policies and guidelines for the payment of Minister's legal costs that have been adopted by the States, Territories and New Zealand.

The Committee also took evidence from officer of the Attorney-General's Department on proposals for statute-based schemes for payment of legal costs of Ministers and members of parliament.

In this report, the Committee noted evidence advising that the nature of parliamentary duties may leave Members of Parliament particularly open to civil actions, such as negligent misstatement actions. The Committee also noted that parliamentarians have no special immunity from civil actions for damages arising from their position and duties as Members of Parliament. The Committee considered that Members of Parliament need to be aware of the legal rights and responsibilities that are concomitant with their duties.

Accordingly, the Committee has recommended that the Presiding Officers ensure that newly-elected Senators and Members of the House of Representatives receive advice during orientation programs on the legal liability of parliamentarians.

In relation to the provision of Commonwealth assistance to Ministers for legal matters, the Committee is of the view that comprehensive arrangements, based on appropriate and transparent criteria and procedures, should be established

The Committee welcomed advice from the Attorney-General's Department that it is developing a proposal for a statute-based scheme to be established by regulation under the Parliamentary Entitlements Act 1990. These regulations will include revised guidelines to be applied when determining whether it is appropriate for the Commonwealth to pay a Minister's legal costs.

In this report, the Committee makes several recommendations about such a statutory based scheme. For example, The Committee recommends that revised guidelines should include indicative limits on the use of public funds to pay Ministers legal costs, but that these limits contain an element of discretion to retain flexibility.

The Committee also recommends that the revised guidelines indicate the level of professional legal services that are considered appropriate to specific court proceedings.

The Committee was concerned about extravagant or unnecessary litigation strategies and has recommended that revised guidelines should require the Attorney-General's Department to monitor the strategies being pursued by Ministers in legal proceedings and that the revise guidelines stipulate that extravagant or unnecessary strategies adopted in the course of legal proceedings will not be funded. The Attorney-General's Department should determine and advise beforehand whether a strategy is extravagant or unnecessary.

The Committee also reviewed existing arrangements about who decides whether a minister's legal costs will be paid and has recommended that, in relation to a personal claim against a Minister, the decision to pay legal costs should be made by Cabinet, based on advice from the Attorney-General that the matter is part of the Minister's duties.

The Committee also recommended that the Commonwealth Government maintain its policy not to use public funds to assist Ministers to institute defamation actions.

The second part of the Committee's report relates to reporting of these payments to Parliament.

The Committee considers that discretionary payments to parliamentarians require a high degree of transparency, control and accountability. Where politicians are providing discretionary payments to other politicians, the public is entitled to such a standard.

The Committee considers that the proposal to establish schemes relating to the payment of Ministers' legal costs by regulation under the Parliamentary Entitlements Act 1990 is consistent with constitutional and legal principles that the Parliament must pass a bill that contains an appropriation for any money expended on a Minister's legal costs and that any allowance or pecuniary benefit paid to a Member of Parliament must be paid pursuant to a law enacted by the Parliament.

The Committee has recommended that, if a scheme is established to appropriate expenditure for Ministers' legal costs under the standing appropriation contained in section 11 of the Parliamentary Entitlements Act 1990, the relevant regulations should require the Attorney-General to inform the Parliament of each decision to pay a Minister legal costs, at the earliest opportunity This information should include the initial reasons for the decision to pay the legal costs and any limitations placed on expenditure.

In addition, the Committee has recommended that a consolidated statement on current cases, including progressive levels of expenditure, should be tabled in the Parliament every three months.

The Committee considers that these and other measures recommended in the report will ensure that the payment of a Minister legal costs will be done in a transparent and accountable manner.

I commend this report to the Senate.

Debate adjourned.