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Wednesday, 27 June 2012
Page: 4721


Senator WONG (South AustraliaMinister for Finance and Deregulation) (17:51): I present the following two government responses to committee reports. In accordance with the usual practice, I seek leave to incorporate the documents in Hansard.

Leave granted.

The documents read as follows—

Primary Schools for the Twenty First Century: Government Response to the Interim Report Senate Education, Employment and Workplace Relations Committee

Recommendation

Response

Recommendation 1

The committee majority recommends that all quarterly reports on maintaining state spending on primary school infrastructure be made available immediately.

Disagree

Information in the quarterly reports is provided by the States in confidence and on the understanding that it would only be made public, in respect of a particular state, if the Commonwealth decided to impose a sanction on that state for failure to meet its benchmark.

Recommendation 2

The committee majority recommends that when the next round of P21 funding is made available the remaining P21 program funds be provided directly to those government schools choosing to manage their own projects to completion.

Disagree

With over 99 per cent of all P21 projects having commenced as at 31 December 2010, providing schools with funds directly, particularly where contractual commitments are already in place, would serve little benefit.

In its August 2010 interim report, the BER Implementation Taskforce recommended that projects not yet committed should be delivered in accordance with a pre-BER 'business as usual' approach to capital works and that school stakeholders should be more involved in decision making.

The Government has agreed to implement this recommendation made by the Taskforce in its August 2010 interim report.

Recommendation 3

The committee majority recommends that the government immediately require all state and territory education authorities and Block Grant Authorities to publish breakdowns of all individual P21 project costs.

Noted

In its August 2010 interim report, the BER Implementation Taskforce recommended that in the interest of transparency and public accountability, each education authority publish school specific project cost data related to BER P21 in a nationally common structure with consistent definitions. The Government has agreed to put in place a nationally common structure with consistent definitions. This structure was published in January 2011 with the agreement of education authorities.

Recommendation 4

The committee majority recommends that DEEWR release original applications and project costs as P21 projects are completed, together with an explanation regarding any contract cost variations.

Agree in part

Consistent with the response to recommendation 3, the Government has agreed to put in place a nationally common structure with consistent definitions for reporting on project costs. This structure was published in January 2011 with the agreement of education authorities.

The Government does not agree to release original applications as they pre-date detailed tendering and procurement processes and buildings were not designed or costed in detail at that point. In addition, the original applications and project costs may have been subjected to variations for a number of valid reasons and this will not be evident in this information.

Recommendation 5

The committee majority recommends strengthening accountability mechanisms for oversight of state expenditure of Commonwealth money. This should include enhancing the powers of the Auditor-General to 'follow the money trail' to ensure value for money is achieved by the Commonwealth for,

state expenditure of Commonwealth monies.

 

Noted

This issue was covered in the terms of reference of the Joint Committee of Public Accounts and Audit (JCPAA) Inquiry into the Auditor-General Act 1997. While that inquiry lapsed with the prorogation of the Parliament on 19 July 2010, it would be appropriate for government to respond to this issue through any recommendations arising from that Inquiry.

The Government further notes that the BER Implementation Taskforce was established by the Australian Government in April 2010 with the express purpose of assessing value for money aspects of individual projects, as well as systemic issues, and ensuring allegations of waste are fully investigated. With the ongoing work of the Taskforce, a Senate inquiry, two state parliamentary inquiries, an Australian National Audit Office audit and the various audits being undertaken within jurisdictions the BER is a heavily scrutinised program.

Recommendation 6

The committee majority recommends that the BER Implementation Taskforce be given access to all costings and be able to examine all relevant contracts to enable it to properly discharge its function to ensure the community that value for money is being achieved.

Agree

The Government established the BER Implementation Taskforce to provide an additional level of scrutiny over the

implementation of the BER program, assessment of value for money and the use of Australian Government money.

In its August 2010 interim report, the Taskforce noted that it is receiving cooperation from Education Authorities to access costings and relevant contracts.

Recommendation 7

To ensure that further taxpayer money is not subject to waste and mismanagement, the committee majority recommends that the release of any further BER funding be

delayed until the BER Implementation Taskforce reports to the Minister for

Education in August 2010.

Disagree

The BER Implementation Taskforce released its interim report on 6 August 2010. The Government has accepted and will implement in full all 14 recommendations. The report stated that the BER program Is delivering much needed infrastructure to school communities while achieving the primary goal of economic activity across the nation."

The Government will continue to consider recommendations from the Taskforce regarding any future payments.

Recommendation 8

The committee majority recommends that the BER Implementation Taskforce report be made publicly available when it is presented to the Minister for Education.

Agree

The BER implementation Taskforce interim report was made publicly available when it was released on 6 August 2010. The Taskforce's first full report was also made publicly available when it was released on 15 December 2010.

Recommendation 8

The committee majority recommends that the BER Implementation Taskforce report be made publicly available when it is presented to the Minister for Education.

Agree

The BER implementation Taskforce interim report was made publicly available when it was released on 6 August 2010. The Taskforce's first full report was also made publicly available when it was released on 15 December 2010.

Recommendation 9

In order to fully examine the systemic failure of Commonwealth oversight mechanisms, the committee majority recommends that a judicial inquiry be established to inquire into whether the BER program has achieved value for money.

Disagree

The Government believes a judicial inquiry is a long and expensive exercise that is unnecessary for a program that has already been subject to an Australian National Audit Office investigation and federal and state parliamentary inquiries.

The Government established the BER Implementation Taskforce to provide an additional level of scrutiny over the

implementation of the BER program, assessment of value for money and the use of Australian Government money. The independent chair of this taskforce has testified that all 22 Education Authorities are fully cooperating with his inquiries and making all requested documentation available. The Taskforce comprises specialist expertise from the building and construction industry, economists, Quantity Surveyors and contract law experts.

Senate Rural and Regional Affairs and Transport References Committee report on Investment of Commonwealth and State funds in public passenger transport infrastructure and services

Government Response

On 4 December 2008 the Senate referred the following matter to the Rural and Regional Affairs and Transport References Committee for inquiry and report by 18 June 2009:

The investment of Commonwealth and state funds in public passenger transport infrastructure and services, with reference to the August 2005 report of the House of Representatives Standing Committee on Environment and Heritage, Sustainable Cities, and the February 2007 report of the Senate Standing Committee on Rural and Regional Affairs and Transport Committee, Australia's future oil supply and alternative transport fuels, including:

a.   an audit of the state of public passenger transport in Australia;

b.   current and historical levels of public investment in private vehicle and public passenger transport services and infrastructure;

c.   an assessment of the benefits of public passenger transport, including integration with bicycle and pedestrian initiatives;

d.   measures by which the Commonwealth Government could facilitate improvement in public passenger transport services and infrastructure;

e.   the role of Commonwealth Government legislation, taxation, subsidies, policies and other mechanisms that either discourage or encourage public passenger transport; and

f.   best practice international examples of public passenger transport services and infrastructure.

The Committee's report was tabled on 20 August 2009 and made nine recommendations. The Government response is set out below.

Recommendation 1

That the Commonwealth recognise the cost-effectiveness of the 'TravelSmart' behaviour change program and consider reinstating funding for it from an appropriate department.

Response

Noted.

TravelSmart was delivered in conjunction with local governments under the Greenhouse Gas Abatement Program (GGAP). The Wilkins Review, Strategic Review of Australian Government Climate Change Programs of 31 July 2008, recommended that the GGAP terminate in 2008-09. The GGAP subsequently ended.

The Commonwealth Government's view is that travel behaviour change measures, such as the TravelSmart projects, are most effectively developed and applied at a local/regional level by State, Territory and Local governments.

The Commonwealth Government recognises there may be benefit in sharing information on travel projects at a national level and will continue to explore opportunities with State and Territory governments.

Recommendation 2

The Commonwealth in future negotiation of HACC agreements should be mindful of -

the effectiveness of present community transport services;

future transport needs of groups targeted by community transport;

appropriate balance between community transport, regular public transport and taxis to meet those needs; and

appropriate division of responsibilities, actions and funding to meet those needs.

Response

Noted.

Transport services are available to frail older people and younger people with disabilities, and their carers, through the current Home and Community Care (HACC) program. Assistance is provided with transportation either directly (for example, in a vehicle provided or driven by an agency worker or volunteer) or indirectly (taxi vouchers).

On 2 August 2011, the Commonwealth Government, in partnership with states and territories, signed the National Health Reform Agreement (NHRA). The NHRA cements the commitments made by all governments at the 13 February Council of Commonwealth Governments' meeting, to work together to reform the health system to ensure its future sustainability.

Under the NHRA the Commonwealth assumed full funding and policy responsibility for basic community care maintenance and support services for older people from 1 July 2011 and will assume operational responsibility from 1 July 2012 in all states and territories except Victoria and Western Australia.

States and territories will be responsible for funding care services for younger people ( non-Indigenous people under 65 years and Aboriginal and Torres Strait Islander people under 50 years) - such as younger people with disabilities - wherever they are receiving care.

These changes are part of broader aged care reforms which will include consideration of future arrangements for community transport under HACC to ensure the creation of a nationally consistent, integrated and coordinated aged care system. Proposals in the Productivity Commission's report, Caring for Older Australians, which was released on 8 August 2011, may also inform future reforms to HACC services.

On 18 March 2011, the Commonwealth Government launched the National Disability Strategy which outlines a 10-year national policy framework to improve the lives of people with disability, promote participation, and create a more inclusive society. The Strategy will guide public policy across governments and aims to bring about change in all mainstream services and programs as well as community infrastructure. A key policy direction under the Strategy involves the creation of 'a public, private and community transport system that is accessible for the whole community'.

Recommendation 3

The Commonwealth Government in consultation with the states/territories and other stakeholders should establish a national transport research body suitable to be a national centre for detailed research into world's best practice public transport and active transport.

Response

Noted.

The present arrangements provide for national transport research through various means.

As a national transport research body, the Bureau of Infrastructure, Transport and Regional Economics (BITRE) is conducting research on public transport issues as part of its research program. Two recent BITRE publications are Urban Passenger Transport: How people move about in Australian cities, and Urban Public Transport: recent bus transport statistics.

The Commonwealth Government is collaborating with the states and territories, which have primary responsibility for public transport delivery and management.

In late 2009, the Australian Transport Council (ATC) endorsed the Australian Strategic Transportation Agenda for Research and Technology. In addition, the Council Chair will write to the Chair of the Australian Research Council (ARC) annually seeking ARC's consideration of ATC's strategic transportation research themes when determining ARC funded research.

Recommendation 4

Commonwealth funding for public transport should only occur in the context of overall funding for infrastructure projects that meet a strict merit-based criteria. These include an objective assessment of the broader community and economic benefits and the degree to which the sponsoring state government has adopted an integrated, inter-modal, best-practice approach to transport planning and management. The Commonwealth can only make such decisions in the context of broader judgments regarding all competing infrastructure projects that have national significance.

Response

Noted.

The Commonwealth Government has made infrastructure investment a key national priority, and has initiated and implemented a strategic approach to national infrastructure development.

Integral to this national strategic approach is Infrastructure Australia's work in identifying both infrastructure gaps that hinder economic growth, and investment priorities for the coordinated delivery of national infrastructure investment.

Acknowledging the vital function of Infrastructure Australia, the Government provided an additional $36 million in the 2011-12 Budget to enhance its role in planning and advising governments and the community on infrastructure investment opportunities.

Infrastructure Australia's mandate has also been expanded to include the production of an enhanced priority list to identify projects through top-down analysis of nationally significant infrastructure needs, only considering projects that exceed $100 million, are flagship, or demonstrate unique national interest characteristics.

Part of Infrastructure Australia's development of a long term integrated approach to infrastructure investment will be to develop a national public transport strategy. This proposed strategy will be aimed at improving service standards through better use of existing infrastructure and investment in new infrastructure.

Recommendation 5

The Government should investigate options for tax incentives for public transport including estimating their likely effects on people's travel behaviour.

Response

Noted.

The report of the Australia's Future Tax System review (the Tax Review) made no specific recommendations in relation to tax concessions for public transport, although it did report on the taxation of transport more generally.

On 4 and 5 October 2011, the Government held a Tax Forum to continue the tax reform debate and discuss ways to build on the Government's substantial tax reform agenda. The forum focussed on the broad sweep of topics in the Tax Review, with sessions discussing personal tax, transfer payments, business tax, state taxes, environmental and social taxes, and tax system governance.

Issues regarding transport taxes, including congestion charging, road pricing, and fuel excise were debated. Issues relating to road pricing and user charging are largely a matter for state and territory governments.

Recommendation 6

Government support for behavioural change programs ('TravelSmart') should include measures to encourage 'buy-in' by employers in promoting sustainable transport in their workforces.

Response

Noted.

Please refer to response to Recommendation 1.

Recommendation 7

The Government should amend the car fringe benefits tax (FBT) statutory formula to remove the incentive to drive excessively to reach the next FBT threshold.

Response to Recommendations 7, 8 and 9

Agree.

In the 2011-2012 Budget the Government announced a measure to remove the unintended tax incentive for people to drive more than they need to in order to obtain a larger tax concession, by reforming the statutory formula method for valuing car fringe benefits (implements Recommendation 9(b) of the Review of Australia's Future Tax System).

When an employer makes a car available to an employee for private use, a car fringe benefit will generally arise and be subject to FBT. Car fringe benefits are currently valued under either the operating cost method or the statutory formula method.

Under the operating cost method, the taxable value of the benefit is based on the cost of owning and operating the car, reduced by the portion which relates to the business use of the vehicle. Employers are required to substantiate the business use of the vehicle by maintaining a log book for a specified period.

The statutory formula method is designed to provide employers with a low compliance cost alternative to the operating cost method, eliminating the need to maintain a vehicle log book. It removes the need to explicitly distinguish between the business and private use of a vehicle.

Recommendation 8

In relation to FBT of cars by the statutory formula method - the Government should state the purpose of making the tax concessionary (noting that whether the tax should be concessionary, and whether there should be a statutory formula for the sake of easy compliance, are different questions); the Government should investigate and report on what the likely effects on consumer behaviour would be if the concessionary aspect of car FBT was reduced or removed.

Response

Please refer to response to Recommendation 7.

Recommendation 9

The Government should change FBT rules so that the scope of exemptions is consistent between car transport and public transport.

Response

Please refer to response to Recommendation 7.

Additional Comments - Australian Greens - Dissenting Recommendations

Senator Ludlam of the Australian Greens provided additional comments to the Senate Inquiry and proposed replacing Recommendation 4 in the committee report with three recommendations of his own.

'Recommendation 4' already incorporates the views expressed in these recommendations while allowing for a more complete consideration of potential infrastructure projects within a broader transport planning and infrastructure framework. It is noted that the Australian Greens' recommendation to reinstate the funding for the 'Travelsmart' behaviour change program has been responded to in the government response to Recommendation 1.

Australian Greens Recommendation 1

The Commonwealth make infrastructure funding available for public transport, subject to strict merit-based criteria.

Response

Noted.

As discussed in the current Recommendation 4, the Commonwealth Government has made a significant funding commitment towards the development of priority national infrastructure projects through the Nation Building Program and through the advice provided by Infrastructure Australia. The Commonwealth Government has invested unprecedented amounts into public transport projects through the Building Australia Fund and Nation Building Program. This includes more than $7 billion investment in new funding for the planning, development and construction of nine rail projects in Sydney, Melbourne, Adelaide, Brisbane, Perth and the Gold Coast.

Public transport funding will continue to be a consideration of the Commonwealth Government through the next phase of the Nation Building Program from 2014-15 to 2018-19, contingent on meeting strict merit based criteria, such as the principles in the National Urban Policy (NUP). Nationally significant infrastructure needs will continue to be identified by Infrastructure Australia in the future.

Australian Greens Recommendation 2

Proposed Commonwealth funding for public transport be subject to an objective assessment of the broad community and economic benefits and the degree to which the sponsoring state or territory government has adopted an integrated, inter-modal, best-practice approach to transport planning and management.

Response

Noted.

As discussed in the current response to Recommendation 4, the Commonwealth Government takes a strategic approach to infrastructure development and investment, with Infrastructure Australia being integral to this process. Infrastructure Australia's recently expanded role includes the development of a national public transport strategy, which will build on the NUP and the COAG Reform Council's review of capital cities strategic planning systems. Decisions on investment of future public transport projects will consider the extent to which the proposals meet these nationally agreed principles.

Australian Greens Recommendation 3

The Commonwealth recognise the cost-effectiveness of the 'Travelsmart' behaviour change program and reinstate it's funding, building on the valuable work undertaken in this programme to date.

Response

Noted.

Please refer to the Government response to Recommendation 1 in the committee's report.

"The Commonwealth Government's view is that travel behaviour change measures, such as the TravelSmart projects, are most effectively developed and applied at a local/regional level by State, Territory and local Governments".