Senator HOGG (2:37 PM) —My question is addressed to Senator Coonan, the Assistant Treasurer and Minister for Revenue. Can the minister confirm that, according to her own press release of 14 May 2002, only 181 applications of the 475 funds affected by the collapse of Commercial Nominees have been dealt with? How long will the minister take to complete the outstanding cases and how long will the minister take in setting up the compensation payment mechanism? When will those affected finally be able to move on with their lives, after more than a year of watching this government repeatedly drop the ball and then stonewall them?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —Thank you, Senator Hogg, for the question, but it is founded on a total misconception about what is required under the act to evaluate whether there have been some losses that can be compensated in respect of the loss of funds in superannuation. On a previous occasion I said at some length that the process involves, first of all, a lengthy investigation because of the disarray found in the books of Commercial Nominees. The lengthy investigation involves a reconstruction of the books and a reconstruction of the accounts to determine exactly whether there has been either fraud or theft. The scheme does not compensate people for bad investments or even negligent investments and so it is necessary for there to be an independent investigation to establish whether or not there has been fraud or theft that enables a decision to be made under the act. Senator Hogg seems to be oblivious to the role that a regulator plays in this matter. Matters only come to me after these investigations are determined. I then have to ask APRA for their advice and then I can make the determinations.

In respect of the Enhanced Cash Management Trust, I am happy to say that my determinations in that matter are almost completed and I expect to be in a position where that matter can be finalised within a few days. With respect to any other investors affected under Commercial Nominees and the very unfortunate situation that arose there, I will not pre-empt when the investigations are going to be complete but I would expect that, once they are, there will be applications made in respect of those so that people can get their compensation, as indeed the ones from the Enhanced Cash Management Trust have. Whilst the process might seem rather lengthy, obviously you have to take these books as you find them, and a lengthy period of reconstruction was necessary in order to be able to assist the people who have been impacted very badly by this matter. It is a situation which is certainly of concern to me and to the government. Since I came into this portfolio, I have been pursuing this matter constantly so that, at least in respect of the Enhanced Cash Management Trust—which was more advanced in the investigation stage than the other funds—I could actually get on and do all that. I could have waited until the whole lot were finished and done them altogether; I did not think that was appropriate.

The PRESIDENT —Senator Conroy, your behaviour is unacceptable and you are in breach of the standing orders.

Senator COONAN —I thought it was appropriate that as soon as possible the people who were badly impacted by this matter could get their payments. That is the way I am going to proceed—as quickly as I can— with anyone else who has been affected.

Senator HOGG —Madam President, I have a supplementary question. The minister did not really address the issue of how long it will take to complete the outstanding cases. That is an issue of major importance to the people who have suffered as a result of the collapse of Commercial Nominees. Can the minister explain why, when superannuation funds themselves are prepared to pay a levy to underwrite fund losses incurred through theft and fraud, she is limiting compensation to victims of Commercial Nominees to 90 per cent of their losses—and much less if interest was included?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —Thank you, Senator Hogg, for the supplementary question. I thought I had already explained in some detail, in answer to an earlier question, that the 90 per cent was reached not as some sort of arbitrary figure but as an increase on what had previously been determined, the 80 per cent. It seemed that it was a more appropriate way to exercise that discretion to pay 90 per cent but not to create such a moral hazard that there was never, under any circumstances, any risk to anyone who ever invested in a superannuation fund. It is not the case that there is, and indeed I am quite sure that those sitting opposite in this chamber would not expect there to be, an absolute guarantee of all superannuation money invested in this country. It is simply not appropriate to do that. In circumstances where there has been fraud and theft it is appropriate that a proper judgment be made based on the report that has been received. That is exactly what I have done. (Time expired)