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Wednesday, 7 February 2001
Page: 21532


Senator IAN CAMPBELL (Parliamentary Secretary to the Minister for Communications, Information Technology and the Arts) (4:27 PM) —I table a revised explanatory memorandum relating to the Defence Legislation Amendment (Enhancement of the Reserves and Modernisation) Bill 2000 and move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows

DEFENCE LEGISLATION AMENDMENT (ENHANCEMENT OF THE RESERVES AND MODERNISATION) BILL 2000

The Reserves make a vital contribution to Australia's defence. Reserves constitute over forty per cent of the Australian Defence Force and one half of the Army's combat forces. Reserves provide surge capacity and sustainment to the Defence Force. They also provide the nation's mobilisation and expansion base. They are an essential link between the Defence Force and the Australian community. Reserves supplement the competencies and skills found in the Permanent Forces.

The Reserves have made an important contribution to recent military operations. The Defence Force relies on Reserves for the effective conduct and sustainment of operations. This is highlighted by the significant contributions that Reservists make. In recent times, over 1500 Reservists from all three services volunteered for service in East Timor. 13 officers and 200 other ranks served with the 6RAR Group in East Timor supported by 200 Reservists on full-time service within Australia. Reservists serve in Bougainville, as Rifle Company Butterworth in Malaysia and in support of Navy and Air Force operations. Medical and nursing personnel from the Reserves served in Rwanda and routinely support Defence Force operations overseas. 2,500 Reservists supported the recent Olympic Games.

The legislation introduced today will see important changes to the Defence Act 1903, the Naval Defence Act 1910, the Air Force Act 1923

In 1999, the Government decided to legislate to enable the call out of members of the Reserves in circumstances other than war or defence emergency or for the limited periods currently possible under the present Defence Act in the defence of Australia. The legislation will permit the callout of units or parts of the Reserves in certain circumstances. These historic changes will make the Reserves available to support the Defence Force in all situations where the Defence Force is required. The changes will greatly enhance the contribution made by the Reserves. They will result in a more usable and effective Reserve making an important contribution to the generation, delivery and sustainment of defence capability.

Callout will be effected by the Governor General acting on the advice of the Executive Council or in cases of urgency on the advice of the Minister. During periods of callout, members of the Reserves will act under the command of the Chief of the Defence Force and service chiefs. Callout will cease on publication of a revocation order. The amendments simplify existing callout procedures and provide an efficient and flexible system which will permit the Defence Force to operate in all circumstances as a integrated total force.

The need for callout changes has long been recognised, and was identified in the Government's Public Discussion Paper - Defence Review (June 2000); by the JCFADT Report into Australia's Participation in Peacekeeping (December 1994) and the Ready Reserve Review undertaken by Lieutenant General John Coates and Dr Hugh Smith (June 1995).

Whilst the Government recognises the importance of the callout changes, the Government does not intend to lightly or frequently call out the Reserves. There are certain circumstances required before the Governor-General may make a call out order. These include war or war like operation, defence emergency, defence preparation, peacekeeping or peace enforcement, assistance to Commonwealth, State, Territory or foreign Government authorities and agencies in matters involving Australia's national security or affecting Australian defence interest's, support to community activities of national or international significance, civil aid, humanitarian assistance, medical or civil emergency or disaster relief. Callout will not be used indiscriminately, but only when it is necessary to draw on the particular capabilities and specialisations found in the Reserves to supplement those of the Permanent Forces. In most situations, callout of Reserves will be confined to the capability `bricks' actually required and then only for the period of necessary preparatory training and overseas service.

Under the present legislation, the services are divided into Permanent, Emergency and Reserve Forces. In the case of Army, the Defence Act substructuresemergency and reserve forces into the Regular Army Supplement, the Regular Army Emergency Reserve, the Active Army Reserve and the Inactive Army Reserve, whilst Naval Reserves are structured into Naval Emergency Reserve Forces, the Australian Naval Reserve, the Royal Australian Fleet Reserve and the Emergency List of Officers. Navy and Air Force have never raised emergency forces whilst Army has not raised emergency forces for years. The system of Reserves existing under the present legislationcauses significant inefficiencies and a great deal of unnecessary complexity in the administration of Reserves. The existing provisions impede flexible work force planning and detract from the relevance, utility and integration of Reserves within the total force.

The present compartmentalised system of Reserves is tobe replaced by a unified reserve component in each service administered under a single system. As a result, each service in the Defence Force will be reconstituted so as to consist of a Permanent or Regular component and a Reserve component. Navy will consist of the Permanent Navy and the Naval Reserve, Army of the Regular Army and the Army Reserve, whilst Air Force will be made up by the Permanent Air Force and the Air Force Reserve. In general, matters of administration will be dealt with in the regulations. Whenever appropriate, the provisions to apply to Reservists will be the same as those that apply to permanent members. Obsolete and unnecessary categories and provisions will be repealed and consequential changes made to other legislation.

The legislation implements recommendations from the Millar Committee of Inquiry (1974), the JCFADT report into the Australian Defence Force Reserves (1991) and the 1994 White Paper that the structure and types of service available within the Reserves be streamlined and standardised.

The legislation will authorise through the regulations a modern `tiered structure' for the Reserves in each service to enable a seamless transition across the employment categories in accordance with competency and availability requirements. The new tri-service categories of reserves will be:

· High Readiness Active Reserves;

· High Readiness Specialist Reserves;

· Active Reserves;

· Standby Reserves (formerly called the Inactive reserve); and

· Retired Reserves

Provision will be made for the appropriate service chief or delegate to assign or re-assign members to any category of the Reserves. Defence will undertake the necessary steps over the next twelve months to achieve this major revamping and upgrade of the existing Reserve personnel management system.

The legislation contains a number of other important initiatives. Defence will be empowered to offer flexible packages of defence service to prospective recruits and re-enlistees. As an example, a recruit may engage for a period of full-time service in the Permanent Forces followed by Active or Standby Reserve service. Alternatively, a student may enlist for a period of part-time service as a Reservist whilst undertaking studies or training followed by service as a Permanent or Regular all as part of the one engagement. The new flexible personnel management system will assist recruiting and retention in the Permanent Forces and Reserves, and ensure that the community gains the maximum possible benefit from the professional, highly trained members of the Defence Force.

In keeping with its intent to modernise defence administration, the Government recently directed a study into the introduction of swipe card technology to improve the effectiveness and efficiency of Reserve related administration. The Government has also directed Defence to implement measures which bring about a nationally recognised system of accreditation of Reserve training skills in the civilian workplace. A major public awareness and communications strategy is to be implemented so as to inform and educate the community and employers of these initiatives, to promote the Reserves and the value of Reserve service.

Members of the Reserves have competing civil interests that can impact on their availability for training and operational service. It is essential if members of the Reserves are deployed on operations, either voluntarily or on callout, that there be a mechanism which protects their civilian employment and financial, family, and educational interests. Without such protection, a person might be severely disadvantaged by joining the Reserves. While the nature and precise level of protection will vary depending on whether the member is called-out, is voluntarily rendering a period of full-time service or is completing annual training commitments, a reasonable level of protection should always be available. The Defence Reserve Service (Protection) Bill 2000 will provide a comprehensive suite of protection initiatives.

After the passage of this legislation, the Reserve of the future will be very different from the Reserve that we have known in the past. It will be a important contributor to defence capability. It will be a relevant and credible component of Australia's total defence force.

This Bill effects very important enhancements to the Australian Defence Force and particularly to its Reserves and I commend the Bill to the Senate.

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DEFENCE RESERVE SERVICE (PROTECTION) BILL 2000

The Reserves make a vital contribution to Australia's defence. Reserves constitute over forty per cent of the Australian Defence Force and one half of the Army's combat forces. Reserves provide surge capacity and sustainment to the Defence Force. They also provide the nation's mobilisation and expansion base. They are an essential link between the Defence Force and the Australian community. Reserves supplement the competencies and skills found in the Permanent Forces.

The Reserves have made an important contribution to recent military operations. The Defence Force relies on Reserves for the effective conduct and sustainment of operations. This is highlighted by the significant contributions that Reservists make. In recent times, over 1500 Reservists from all three services volunteered for service in East Timor. 13 officers and 200 other ranks served with the 6RAR Group in East Timor supported by 200 Reservists on full-time service within Australia. Reservists serve in Bougainville, as Rifle Company Butterworth in Malaysia and in support of Navy and Air Force operations. Medical and nursing personnel from the Reserves served in Rwanda and routinely support Defence Force operations overseas. 2,500 Reservists supported the recent Olympic Games.

The legislation introduced today will see important changes by the provision of a brand new Act to replace and repeal the current Defence Re-establishment) Act 1965. The Protection bill will protect employed Reservists, student Reservists, self-employed Reservists and employers of Reservists.

Members of the Reserves have competing civil interests that can impact on their availability for training and operational service. It is essential if members of the Reserves are deployed on operations, either voluntarily of on callout, that there be a mechanism which protects their civilian employment and financial, family, and educational interests. Without such protection, a person might be severely disadvantaged by joining the Reserves. While the nature and precise level of protection will vary depending on whether the member is called-out, is voluntarily rendering a period of full-time service or is completing annual training commitments, a reasonable level of protection should always be available.

At present, members of the Reserves who are called-out for continuous full-time service, or who are rendering periods of obligatory service have a measure of employment protection provided by the Re-establishment Act. The Re-establishment Act was enacted in 1965 for the protection of national servicemen. It also applies, in limited circumstances to members of the Reserves who undertake continuous full-time service or part-time service.

The Re-establishment Act makes it an offence for employers to hinder or prevent an employee from volunteering for service in, or serving in, the Reserves, or to prejudice an employee in his employment (eg by reducing salary or wages or dismissing him) because of his or her Reserve service. This applies both to obligatory service and to service the member is bound to render following the acceptance of a voluntary undertaking to render continuous full-time service.

A Victorian Act, the Defence Reserves Re-employment Act 1995 (Vic) is an example of a State Act intended to address some of the deficiencies in existing protection legislation. It gives job reinstatement to members of the Reserves within that State who volunteer for full-time service in circumstances of warlike, peacekeeping or humanitarian operations. No similar protection is available to Reservists in other States or Territories who volunteer for full-time service. The need for State legislation highlights the inadequacy of current defence legislation as it applies to the voluntary rendering of full-time service by Reservists and to the resulting need for legislative reform to enhance the civil protections available to Reservists.

For members who render defence service, the Re-establishment Act protects annual leave and provides for the continuity of contracts of employment. It provides for the resumption or reinstatement in employment of Reservists who complete defence service and makes it an offence for an employer not to accept a returned employee.

The Re-establishment Act is very outmoded and requires review. It provides no protection at all for self-employed members of the Reserves or for student members. The new legislation will significantly enhance the job and education protection available to a Reservist. It will lead to much higher numbers of Reservists, particularly those with professional expertise, critical trade skills or family responsibilities volunteering to complete a tour of duty on full-time service in support of warlike, peacekeeping or humanitarian operations.

The new legislation will provide a modern streamlined code of employment and education protection for Reservists. Without such protection, Reservists and their families might be very severely disadvantaged by Reserve service. The new legislation will ensure that both Reservists and their employers are fairly dealt with whilst Reservists are deployed and upon their return to civil life.

Employment protection will be given to Reservists undertaking annual training. Where Reservists are needed to volunteer for continuous full-time service such as East Timor or Bougainville, or undertake training on a continuous full-time basis, service chiefs will be authorised to request members to undertake that service on a protected basis. Education protection will be available to students who volunteer for continuous full-time service on the same basis. This will ensure that the jobs of employee Reservists who give voluntary continuous full-time service are protected, whilst student Reservists attending an educational institution can recommence their studies where they left off.

Without appropriate protection, Reservists, their families and dependants might be severely disadvantaged by the loss of civil employment income following callout. The Re-establishment Act does provide for the rescheduling of mortgage, loan and hire-purchase payments and interest, the postponement of execution, distress, and bankruptcy procedures, the restriction of partnership dissolutions and on completion of full-time service provides an entitlement for re-establishment loans. However, these protections only apply to persons who rendered national service under the former national service scheme, and not to Reservists after call-out. Under the new legislation, these protections are to be made available to Reservists after callout.

In future, Reservists who are called out will be able to postpone financial liabilities until after the protection period. This will extend for a period of equal length to the member's callout service or one year whichever is the less. The postponement will extend to protect dependants of the member. Protection will be afforded against bankruptcy.

The legislation will safeguard the interests of lenders and financiers. Interest will continue to accrue during the postponement period at the lower rate of interest set out in the mortgage or loan documents, or prescribed by the regulations. Despite the postponement, it will remain in the interests of Reservists undertaking callout service to continue to meet existing financial commitments to the maximum extent possible in order to reduce or minimise their financial commitments. However, financial liability protection will be given to them during callout and for a similar time afterwards.

After completing callout service, Reservists will be eligible for re-establishment loans to assist them to re-establish businesses or return to civilian life. Their loans will be on normal terms and conditions but may be provided or guaranteed by prescribed authorities as was done for national servicemen under the Re-establishment Act.

The need for a code of protection for Reservists was identified by the Government in the Public Discussion Paper - Defence Review 2000, in the Defence White Paper (1994), the JCFADT Report into Peacekeeping (December 1994) and in the Standish Report (1988).

The Government fully acknowledges the vital contribution made by employers of Reservists. In Australia's increasingly competitive economic climate, many employers who have been traditional supporters of the Reserves find it difficult or inconvenient to release Reservists to undergo defence training or serve overseas. In recognition of this, the legislation will authorise the Minister for Defence to make determinations for the payment of compensation, incentives or benefits to employers, business and professional partners arising from a member's absence on defence service.

The Government has directed Defence to introduce a CPI indexed employer support payment from the third and subsequent weeks of defence service in the amount of the average weekly full-time adult earnings - currently $784.90 per week. The payment is to assist employers and self-employed Reservists to offset the costs and consequences of releasing members for defence service and will be operative from the commencement of the legislation. Provision will also be made by Ministerial determination for the payment of higher amounts where justified on an individual case basis.

The legislation will protect employers in other important ways. In addition to the employer support payment, employers will have no legal obligation resulting from the Protection Act to pay remuneration, or meet oncosts such as workers compensation or superannuation contribution payments whilst the member is away on defence service. Under existing defence arrangements, Reservists rendering callout service or voluntary continuous full-time service are covered for compensation in the event of disability, and benefit from superannuation contributions. Employers will have access to the Defence Ombudsman, and have recently been given enhanced representation on the Defence Reserves Support Council.

As with the Re-establishment Act, various forms of unacceptable conduct towards Reservists will be prohibited under the Protection Act. It will be an offence to dismiss or discriminate or refuse to employ a Reservist because that person is liable to, has or may render defence service. Employers must not prevent or hinder persons in their employment from volunteering for or rendering defence service. The provisions of the Protection Act may be enforced by civil proceedings in the courts, whether by award of damages in the event of contravention, or injunction as appropriate. The provisions will not affect existing jurisdiction where previously vested in courts or tribunals.

Whilst the Protection Bill provides for enforcement in appropriate cases, it is expected that mediation and conciliation with employers will in the vast majority of cases resolve any problems to mutual satisfaction. In addition to an interested person, provision is made for a Defence agency, acting as a prescribed person, to take action in any specific matter. The Government intends that employers be supported during the absence of Reservists on defence training with enforcement a last resort only after the failure of consultation and negotiation. Employers will have access to the Ombudsman and representation on the Defence Reserves Support Council.

After the passage of this legislation, the Reserve of the future will be very different from the Reserve that we have known in the past. It will be a important contributor to defence capability. It will be a relevant and credible component of Australia's total defence force.

This Bill effects very important enhancements to the Australian Defence Force and particularly to its Reserves and I commend the Bill to the Senate.

Debate (on motion by Senator Denman) adjourned.