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Wednesday, 11 May 2011
Page: 2372

Extractive Industries Transparency Initiative

(Question No. 343)

Senator Ludlam asked the Minister representing the Minister for Foreign Affairs, upon notice, on 13 December 2010:

With reference to AusAID and the Extractive Industries Transparency Initiative (EITI):

(1) Can the Minister confirm that Australia is a supporter of the EITI and provides funds to assist other countries to implement the EITI while not doing so itself.

(2) Can the Minister confirm the EITI would require all mining, oil and gas companies operating in Australia to publicly publish payments made to the Australian Government (and possibly state and territory governments) and in turn oblige the Government to publish what it receives.

(3) (a) Can an outline be provided of what funds AusAID has allocated to supporting the EITI and who receives those funds; and (b) does the funding include consideration for a secretariat.

(4) Is the Australian Government considering the implementation of an EITI; if not, why not.

(5) Who has responsibility for Australia becoming an implementing country.

(6) Is the department aware the United States of America (US) Financial Reform Act requires all oil, gas and mining companies registered on the US Securities Exchange to disclose all revenue payments made to all governments when the country is operating on a country-by-country basis; and (b) will the department consider progressing similar legislation in Australia noting that such an initiative contributes towards improving the transparency of extractive industries' payments and helps combat corruption; if not, why not.

(7) What is the Government's position regarding the promotion of improved transparency and anti-corruption mechanisms as a G-20 agenda.

(8) Will the Australian Government be promoting the EITI at the next G-20.

Senator Conroy: The Minister for Foreign Affairs has provided the following answer to the honourable senator's question:

(1) Australia is a supporting member country of EITI. Australia provides funding, through the aid program, to support developing countries implement EITI.

(2) EITI is a global initiative promoting the disclosure by both governments and companies of revenue payments relevant to the mining, gas and petroleum sectors. Countries participate in the EITI process on a voluntary basis.

In Australia, each government jurisdiction has its own regulations and financial disclosure obligations. All Australian Government agencies comply with internationally accepted accounting standards and are subject to the Australian National Audit Office. Corporations are regulated under the Corporations Act 2001. Payments made by the mining, oil and gas companies operating in Australia and receipted by the Australian Government are publicly disclosed through these mechanisms.

(3) AusAID has contributed a total of $1.45m to the World Bank administered EITI Multi-Donor Trust Fund, which supports implementation of EITI in developing countries. AusAID has allocated a further $9m over three years for the EITI MDTF. AusAID has also allocated $1m over three years for the EITI Secretariat.

(4) The Government, in conjunction with industry and civil society, is considering the issues around the EITI and its domestic implementation, noting the response to Question 2. The Government has yet to conclude its consideration.

(5) The Commonwealth Government is responsible for considering whether Australia becomes an implementing country, although aspects of implementation may be the responsibility of, and may require the agreement of, state and territory governments.

(6) The Government is aware of the Dodd-Frank Wall Street Reform and Consumer Protection Act 2010 and its impact on the Securities Exchange Act 1934.

The Australian Government is not considering implementing similar extra-territorial legislation in Australia as it considers that initiatives such as the Dodd-Frank Act do not demonstrably reduce corruption. Australian companies already operate in compliance with the International Accounting Standard Board's International Financial Reporting Standards, which it adopted in 2005.

(7) The Australian Government is supportive of the promotion of improved transparency, governance and anti-corruption mechanisms through the G20. Australia is an active member of the G20 Anti-Corruption Working Group which was established following the Toronto meeting in June 2010 to make recommendations for the G20 to promote international cooperation to combat corruption.

(8) In the 2009 Statement of the Pittsburgh Summit, G20 Leaders supported voluntary participation in the EITI. The Australian Government continues to support the EITI.