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Wednesday, 23 March 1994
Page: 2010

Senator KERNOT (Leader of the Australian Democrats) (9.48 a.m.) —I move:

  That this bill be now read a second time.

I seek leave to table an explanatory memorandum, to have the second reading speech incorporated in Hansard and to make some brief remarks.

  Leave granted.

  The speech read as follows

  This bill provides for the Federal Court to enforce lawful orders made by Parliament, and to allow the Court to determine claims that disclosure of information to Parliament would contravene the public interest.

The catalyst for the bill is the conflict between the Senate print media committee and the Treasurer over the committee's request for Foreign Investment Review Board documents.

But I have not put this legislation forward just to solve an immediate problem. That Parliament lacks a satisfactory mechanism to enforce its own orders has been obvious for years, particularly where it is the government which refuses to comply. There has been no satisfactory way of resolving Government claims that disclosure of information is not in the public interest.

When the Coalition tried to obtain evidence about the Whitlam Government's attempt to raise loans through Tirath Khemlani and others, it failed. When Labor tried to obtain documents revealing the Fraser Government's failure to tackle bottom-of-the-harbour tax avoidance, it also failed.

The bill is drafted to allow Parliament to ask the courts to enforce any lawful order made against any person or organisation. But the principal aim is to deal with disputes which arise when Parliament orders a government to disclose information, and the government refuses.

This is not to suggest that Parliament is powerless in the face of non-compliance of this kind. It is just that its powers, while extensive, are widely seen as inappropriate for use in such a situation.

As we know, section 7 of the Parliamentary Privileges Act 1987 gives each House the power to impose a fine or prison sentence for an offence against it. This is Parliament's sanction of last resort, but it is clearly undesirable when a public servant is caught between two orders—Parliament's order to divulge information, and a minister's instruction not to.

In the case now before the Senate print media committee, the House of Representatives would no doubt protect the Treasurer from any action taken against him by the Senate. This would leave the Senate with the option of taking action against the public servant at the helm of the Foreign Investment Review Board, who is acting on the Treasurer's instructions. That is clearly unsatisfactory.

In fact, I believe there is a general view in the community that it is the role of the courts, and not the Parliament, to impose prison sentences or fines. Although there is a school of thought that the courts have no role in determining disputes of a political nature, to leave matters as they are would continue the decades-long uncertainty over the relative powers of Parliament. It is time this matter was resolved, and the only realistic way of doing so is by resort to the courts.

The Senate also has the option of taking political action to get its way. That could include filibustering, or even blocking key bills in protest. But again, I do not believe it is appropriate for Parliament to engage in obstruction to enforce accountability. This is a more civilised alternative which will avoid further erosion of Parliament's standing, and we should use it.

The bill inserts a new section 11A into the Parliamentary Privileges Act.

The new section makes it an offence not to comply with a lawful order of a House or committee and requires the courts to make orders to remedy the offence.

For example, failure to comply with a lawful order to produce documents would be an offence, and the courts would order that the documents be produced.

If an offence is proved, the standard penalties in the Act apply unless the offence has been committed by a public servant acting under a minister's instructions. In that case, the public servant is not convicted of an offence, and no penalty is imposed.

There may be cases where someone other than a minister (perhaps a departmental secretary or company executive) instructs an employee not to comply with an order of Parliament. It could be argued that the employee should be protected from prosecution in those cases.

However in such a case, the secretary or executive would lack the protection of parliamentary privilege—unlike the minister—and would then be open to enforcement action instead of the employee. I have therefore decided to limit the protection of this provision to public servants acting under a minister's instructions.

It has been suggested to me that there should be no penalty for non-compliance with an order of Parliament, and that penalties should only be imposed for contempt of court, in the event that a court orders compliance but the defendant still refuses.

My concern about this proposal is that it makes non-compliance with an order of Parliament cost-free. Anyone could refuse a committee's request for information in the secure knowledge that the relevant House would have to take them to court to get it, and that they would be immune from any penalty.

Furthermore, the courts' power to order compliance provides scope for leniency in imposing penalties, for example by suspending a fine or prison term.

The bill explicitly recognises that a defence against Parliament's order to produce documents or give evidence is that disclosure would be contrary to the public interest. In considering such a claim, the court must hear the evidence or view the document in camera. Disclosure of those proceedings would be an offence unless subsequently ordered by the court, but Parliament would be free to hear the same evidence or receive the documents.

The effect of this provision is to require executive claims of public interest immunity to be determined by the courts. The bill makes it clear that determining such a claim is a balancing act, which requires any prejudice to the public interest which disclosure might cause to be weighed against the public interest in the free conduct of inquiries by Parliament.

In recognition of the significance of the matters at stake, a case under this legislation would be heard in the Federal Court, with any appeal going to the High Court.

And the bill prevents Parliament from having a bet each way. Once a prosecution has been commenced, Parliament would be prevented from imposing its own penalties using section 7 of the Act.

Finally, a prosecution under this bill can only be made by a person authorised by a resolution of the House whose order—or whose committee's order—has not been complied with.

This bill is a constructive attempt to break a deadlock which has existed for far too long. It is a step towards more open government, but one which allows government claims of public interest immunity to be heard and determined impartially.

The Government has given no clear indication of its position on this bill. I would point out to them that failure to support it would look distinctly hypocritical, given the vehement attacks on me for leaving open the use of the penalty provisions of the Act to obtain Foreign Investment Review Board documents from the Board's Executive Member.

The bill provides an alternative process which would allow the Federal Court to resolve the dispute without any threat of a penalty against any public servant. It depoliticises the competing claims of the committee and the Treasurer as to whether disclosure is in the public interest. If it doesn't become law, then we will be thrown back on the inappropriate provisions of the Parliamentary Privileges Act.

This bill is a fair and reasonable alternative, and I commend it to the Senate.

Senator KERNOT —Recently there has been a great deal of discussion about the role of the Senate and what powers it should or should not have. There is general consensus that one of the Senate's key roles—perhaps its primary role—is to enforce accountability; to act as an assertive house of review. I do not believe that the Senate will be properly able to carry out that role while it lacks the power to enforce its orders that information be divulged. This bill provides that power. However, it qualifies that power by explicitly recognising that disclosure may not be in the public interest, and it depoliticises the public interest test by placing it in the hands of the courts.

  The prospect that the Senate might use its imprisonment power to obtain government documents has been very controversial. This bill provides an alternative procedure which, once used in a given case, precludes the imposition of penalties by the Senate.

  For those who believe that imprisonment is the role of the courts and not of the parliament, this bill goes a long way towards addressing their concerns. For those who believe in open government and accountability, this bill enhances both. For those who believe that public interest immunity claims are best determined in the depoliticised environment of the courts, this bill provides for just that.

  I have indicated before that I think there is some merit in the proposal that the Senate's power to block supply be repealed in exchange for greater powers to enforce accountability. This bill provides an additional power of the kind I have in mind. I commend the bill to the Senate.

  Debate (on motion by Senator Burns) adjourned.