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Tuesday, 13 May 2014
Page: 2383


Senator BACK (Western AustraliaSecond Deputy Government Whip in the Senate) (12:32): I rise with pleasure to support the Fair Work (Registered Organisations) Amendment Bill 2013. This bill honours a commitment which the coalition took to the September 2013 election—and I quote from the coalition's policy document—for 'better transparency and accountability of registered organisations'. The Prime Minister, Mr Abbott, said at the time of the election: 'The coalition will take strong action to ensure registered organisations are more transparent and accountable. We will act on this in the first week of the new parliament'—and indeed he did. He went on to say that Australians who join trade unions or employer associations deserve to have confidence in the conduct and administration of these organisations, that registered organisations are a central part of the fair work regime and they must operate to the high standards. In government we have honoured that commitment, and we stand here today in support of the bill.

I will go to the four premises of the bill—and they were spelt out in the Senate Education and Employment References Committee report to this place in 2014. The bill proposes to: firstly, establish an independent registered organisations commission to monitor and regulate registered organisations, with enhanced investigation and information gathering powers; secondly, amend the requirements on officers' disclosure of material personal interests and change grounds for disqualification and ineligibility for office; thirdly, strengthen existing financial accounting disclosure and transparency obligations under the Fair Work (Registered Organisations) Act 2009, making them enforceable as civil remedy provisions; and, fourthly, increase civil penalties and introduce criminal offences for serious breaches of officers' duties as well as new offences in relation to the conduct of investigations under the Fair Work Registered Organisations Act 2009.

It is interesting to reflect on the background and the reasons for the need for these amendments to come into place—and I intend to speak to them in some detail—but it is equally interesting that in December 2013 the Senate Education and Employment Legislation Committee reported to the Senate on the outcome of that legislation committee report. Immediately the legislation committee report was in, we then had the opposition—the Labor and the Greens—joining forces to call for an Education and Employment References Committee inquiry into exactly the same issue. It is disappointing that, with all of the hard work that befalls us in the Senate, we had to have the chiefly political exercise of effectively going through exactly the same matters again. At that time, the coalition senators noted that the Senate committee was charged with looking at Labor's amendments to the registered organisations regime in 2012. And at that time—and I think this is very important from the viewpoint of accountability—as a result of a direction by the then Minister Bill Shorten, the committee had only five days in which to examine what was then the 'Shorten bill'. I contrast that with the four weeks this committee was given by our coalition government.

So all of this goes back to the laziness and incompetence of the then Minister Shorten. He saw what the coalition was bringing as a policy to the 2013 election, he panicked and he directed his department to try and short-circuit the whole process. As would be expected from a person of this limited capacity, he obviously got it wrong. To make sure that it was not given adequate opportunity for scrutiny, this place had only five days to examine the bill. It is interesting that the now opposition, then in government, failed to consult, failed their opportunity to speak to their own constituency and actually get that legislation right in the first place.

For example, in support of what I am saying, the coalition senators firmly agreed with the then Australian Workers Union National Secretary Mr Paul Howes who said at the time in relation to union corruption, 'If we ignore any pocket of dishonesty—it will grow like a cancer.' He spoke further about the need for developing corruption resistance at every level. So in fact this legislation and these amendments from the government have the strong support of those members of the union movement who share the same discouragement, the same disappointment. Indeed, in some instances, the same shame was actually visited upon the Australian community, particularly upon well-meaning and honourable members of the union movement. What we require in this legislation and these amendments is a circumstance in which those responsible for moneys of members' registered organisations, be they employer, trade union or whatever form, should be the subject of the same rigors and the same civil or criminal penalties for very serious offences. It would bring it into line and in the minds of the Australian community it would create a sense of fairness, a sense of transparency and a return to a sense of honour. Surely, that is a matter which is of tremendous interest and concern to the Australian people.

There were five recommendations that came forward from the legislation committee to the Senate. I am very pleased to be able to record the recommendations and those that are now found in these amendments which we are debating today. One would only hope that the Labor Party and the Greens senators will see the sense of them. One hopes that they will see that the ill-considered and improperly constructed legislation then presented by Mr Shorten will be redressed and will return to a level of comparability between the registered organisations representing employer groups as well as trade unions. For example, the first recommendation was:

The Committee recommends that, consistent with the Corporations Act 2001, material personal interest disclosures should only be required to be made to those officers whose duties relate to the financial management of the organisation.

As it is now, this is potentially required by everybody. Only those with responsibility for the purse strings, those with some level of financial accountability, should be the people who have who are called to account under the new legislation. The first amendment, then, reads:

Limit the obligation to disclose material personal interests to officers whose duties include duties that relate to financial management of the organisation or branch.

So in your capacity as the acting chair of the committee, Senator McKenzie, isn't it tremendous to see that these recommendations, as moved and as presented to this place, have indeed found their way into the actual amendments that are before us today?

Senator McKenzie interjecting

Senator BACK: The second recommendation was that a list of exclusions from the obligations to disclose material personal interests based on section 191(2) of the Corporations Act be inserted into the bill, thus narrowing the obligation to disclose material personal interest of officers' relatives. The legislation at the moment encompasses the possibility of somebody's spouse, children or whoever. Indeed, we see the amendments coming through before us today removing the express obligation on officers and organisations to disclose details of any material personal interest an officers' relatives has or acquires in a matter that relates to the affairs of an organisation. So once again, we see common sense prevailing from this side. We see a recommendation that has come before this chamber finding its way into the amendments, which are the subject of our debate.

The third recommendation was that, with certain exclusions, the obligation placed on officers to disclose every payment should be reduced, including limiting disclosures to payments made above a certain threshold. Following that recommendation we see the provision of a civil penalty for an organisation's or branch's failure to provide minutes of meetings of the committee of management to members. Any member of a registered organisation should have the right to examine the minutes of meetings of the committee of management. This is a circumstance that should have been dealt with in the original legislation, if it had not been pushed through in such a panicked fashion by the then minister, now Leader of the Opposition, Mr Shorten.

Another of those amendments that we will consider in this place is aligning the obligation on officers to disclose material personal interests with section 191(2). This will be done by inserting into the bill similar exclusions to the obligations to disclose material as is applicable to directors of companies. In the evidence that came before us in the Senate inquiry process, these points were raised by witnesses—by employer representatives and by union representatives. It is interesting to see that they have been picked up, that the coalition in government has listened to both sides and has acted.

We are also considering the expansion of exclusions that apply to the disclosure of payments made by an organisation or branch to related parties, including the exclusion of payments that are less than a prescribed amount. Once again the commissioner will have the authority to be able to set a figure below which these sorts of disclosures are not necessary to be made. To bring all this together, the amendments before us enable the Registered Organisations Commissioner to grant exemptions from the training requirements if an organisation can demonstrate that an officer has a proper understanding of their financial duties within the organisation or the branch. This naturally again goes to a level of common sense. It goes to submissions that were placed before the committee. It goes to representations by witnesses. There are training requirements and skills required of people involved in financial management of registered organisations. If, indeed, there are people who already have those financial skills and can demonstrate to the commissioner that they have them, then what is the purpose or the reason for the cost associated with having to go through and undertake those activities once again?

In the time that is left available to me it gives me no pleasure to reflect on the background and some of the reasons that we find ourselves in these circumstances. Naturally enough, although not exclusive to the amendments, we had the circumstances associated with Mr Craig Thomson—once a member of parliament in this place—and the former ALP national president, Mr Michael Williamson, both acting in their capacities as officers of the Health Services Union. We spent far too much time in this parliament over the last three to four years distracted by the actions and activities of both those men, both of whom have now been dealt with by the courts and, of course, found guilty of the activities with which they were associated. In the case of Mr Thomson they were activities which he emphatically denied even on the floor of the other house in this place. These are people who were found guilty of misusing Health Services Union members' funds—in the case of Mr Williamson, almost $1 million. At the time all of this was taking place my mother was a high-care patient in a nursing home in Perth, and I remember reflecting on the excellence of the care that was given to her and to the other elderly patients, including those with Alzheimer's and other conditions. The people who were providing that care had paid their union fees for many years only to see those funds going to the purposes for which it has now been established both Mr Thomson and Mr Williamson have either admitted or been found guilty. I recall an interview with an elderly Eastern European lady who had worked her entire life. Somebody had done the figures and had said to her, 'With those funds you could have had a trip back to Europe to visit your family.' She said, 'No, I would have used those funds towards the education of my grandchildren.' How those people can reflect on their behaviour, one can only imagine.

The important thing is that if we had had this legislation and amendments in place prior to the time those people carried on with those behaviours, one would hope that we would not have seen that abhorrent behaviour which was the subject of so much scrutiny, discord and disappointment to the Australian community. Yet we see it playing out again with respect to the ex-secretary of that same union, Ms Kathy Jackson, who was very much involved in the processes associated with those other gentlemen. In the last couple of days we have seen in the Federal Court an allegation that Ms Jackson siphoned off almost $250,000 of members' funds into a bank account of which she was the beneficiary. That is the allegation that was presented by lawyers for the Health Services Union in only the last two or three days, so no doubt we are going to see that play out as well. Surely members of unions, particularly those who do not have the opportunity to be represented at meetings, have the right to see the minutes of meetings and to understand the activities of their unions. One can only speculate on what they must think when they hear about behaviour like that and when they see where their funds have gone. I urge strong support from the other side in this place to ensure that these amendments go through in the way in which they are intended.

In different circumstances, but relating particularly to my own home state of Western Australia, we see being played out in the royal commission the activities of the Australian Workers Union and their former leadership, Mr Wilson and Mr Blewitt assisted by their former lawyer, Ms Gillard. When I was in Kalgoorlie late last year discussing this question with some members of the AWU, one of them told me in a very distressed fashion of an incident which occurred—

Senator Cameron interjecting

Senator BACK: I know Senator Cameron will be interested in this story, which was told by this gentleman who was an official of the union. He said that they had a million dollars on account in the goldfields. It was a big sum of money at the time, in the 1990s. There was huge pressure on them to release those funds and make them available to the management of the organisation in the city, and they opposed it vehemently. But a very smart young female lawyer turned up from Melbourne and they reluctantly made the decision and the million dollars disappeared. The gentleman said, 'I'll always remember the next day when a fellow that I never knew, but I knew of, came to the Kalgoorlie office, grabbed all the files pertaining to that matter, took them out to the Kalgoorlie tip and burnt them.' I think that is what stuck in their craw more than anything else. It was not the fact that the funds all disappeared—although that really worried them. It was not so much the fact that $1 million, which they no doubt had imminent use for given the nature of the industry that we see in the goldfields of WA, but it was the fact that any possible trail of accountability or audit literally went up in smoke. I have no doubt that we are going to see that game played out even more.

The last matter which I will draw senators' attention to is very current in Western Australia, and it is associated with the MUA. I have in front of me the declaration of results from the Australian Electoral Commission, and 41 members of the union have voted to put themselves in a circumstance where they can strike under a protected action ballot for 24 hours. That was question 1 that was asked of those who were eligible. All 45 out of 45 voted for a 24-hour strike to be undertaken. The next question related to whether there could be an unlimited number of stoppages for a period of 48 hours. We are talking about $100 million a day. Out of 45 members, 44 supported that one; one did not. The third question was whether or not they would have unlimited stoppages for seven days. That is $700 million to $1 billion of direct costs in that period of time without considering the workers at the mines, on the trains, in the trucks and, of course, the rest of the industry which is so vital to this country. That is where we are being held, and I come back to the point which is simply this. There should be unanimous support right around this chamber for the amendments contained in the Fair Work (Registered Organisations) Amendment Bill 2013.