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Monday, 6 November 2006
Page: 135


Senator SANTORO (Minister for Ageing) (4:17 PM) —I 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—

COPYRIGHT AMENDMENT BILL 2006

The Copyright Amendment Bill 2006 introduces significant reforms to the Copyright Act 1968 demonstrating the Howard Government’s ongoing commitment to having an effective, world class and up to date copyright regime. Australians are great technology adopters. We have world class musicians, film makers and other creative industries. The amendments ensure we have a copyright regime that keeps pace with the needs of Australian copyright creators and copyright consumers.

Keeping pace with changing technology is not easy. When this Government passed the Copyright Amendment (Digital Agenda) Act in 2000, the legislation was groundbreaking—putting Australia at the forefront as one of the first countries in the world to update its copyright laws to deal with the digital revolution.

But since then the Internet and digital technologies have created new challenges and opportunities affecting copyright. For consumers, more copyright material is available online and can be easily transferred into different formats. Copyright owners have new distribution channels. But they also face challenges such as widespread unauthorised file sharing of music and films.

The Government is committed to dealing with these challenges to copyright head-on, while seeking to also acknowledge the opportunities technology presents. We want laws in place which mean copyright pirates are penalised for flouting the law, whilst ordinary consumers are not infringing the law through everyday use of copyright products they have legitimately purchased.

The important reforms include new exceptions to make our copyright laws more sensible and defensible. The bill also introduces new offences and enforcement measures to ensure that those who seek to undermine the legitimate rights of copyright owners can be brought to account.

These balanced and practical reforms will ensure the effectiveness of our copyright laws in a dynamic environment.

New Exceptions

The bill introduces several new exceptions to copyright in response to the Government’s ‘Fair Use’ review. First, the reforms recognise that common consumer practices of ‘time-shifting’ of broadcasts and ‘format-shifting’ of some copyright material should be permissible.

This bill will amend the Copyright Act to make it legal for people to tape TV or radio programs in order to play them at a more convenient time.

It will be legal to reproduce material such as music, newspapers and books into different formats for private use—meaning people can transfer music from CDs they own onto their iPods and other music players. As a result of these changes, millions of consumers will no longer be breaching the law when they record their favourite TV program or copy CDs they own into a different format.

These reforms are innovative and technology is changing rapidly. I note there has been some commentary on technical aspects of the exposure draft of the bill in relation to format shifting to iPods. That is why the drafts of this bill were made publicly available—for comment.

The Government will listen to and consider comments and make any necessary technical changes to ensure the bill achieves the Government’s objectives.

There are also new exceptions to provide flexibility to allow copyright material to be used for certain socially useful purposes, where this does not significantly harm the interests of copyright owners. The bill provides for a new exception to allow cultural and educational institutions and certain individuals to make a use of copyright where that use does not undermine the copyright owner’s normal market. The flexibility of this new exception will provide, in these specified areas, some of the benefits that the fair use doctrine provides in US law.

Another exception allows people with disabilities that affect their capacity to access copyright material to be able to make uses of that material in order to better access it.

Another exception promotes free speech and Australia’s fine tradition of satire by allowing our comedians and cartoonists to use copyright material for the purposes of parody or satire.

The needs of our educational and cultural institutions are also addressed in the bill. By giving schools, universities, libraries and archives the chance to use copyright material for non-commercial purposes, they will be able to better assist their users in the online environment.

Technological Protection Measures

In our online world, copyright owners are facing an increasing battle to protect their copyright material and developing business models.

Technological protection measures (TPMs) such as technical locks, passwords or encryption, are an essential tool for the protection of copyright material, especially in the online environment. They provide an effective means for copyright owners to protect their material against the threat of piracy.

The bill provides for more effective TPM protection to encourage distribution of copyright material online and increase the availability of music, film and games in digital form.

This, in turn, will foster development of new business models and provide enhanced choice for consumers.

The liability scheme established by the bill will target people who circumvent TPMs, in addition to those who manufacture or supply devices or services used for circumvention.

However, the liability scheme also provides for specific exceptions in the bill and Copyright Regulations in accordance with recommendations of the House of Representatives Standing Committee on Legal and Constitutional Affairs. In addition, the bill will create an exception for ‘region coding’ devices and allow Australian consumers to use multi-zone DVD players.

Enforcement Measures

But in the digital environment it is not enough that our law supports copyright owners in their efforts to technologically protect their material.

The reality is that it has become increasingly easier to infringe copyright. The bill therefore introduces reforms aimed at tackling copyright piracy online and at our markets and borders.

The bill will create indictable, summary and strict liability offences with a range of penalty options. The strict liability offences will be underpinned by an infringement notice scheme in the Copyright Regulations. This will give law enforcement officers a wider range of options depending on the seriousness of the relevant conduct, ranging from infringement notices for more minor offences, to initiating criminal proceedings to strip copyright pirates of their profits in more serious cases. They are not aimed at ordinary people, but at copyright pirates who profit at the expense of our creators.

While technological advancements have made it easier for people to infringe copyright on a large scale, this has also made it more difficult to prove specific acts of infringement.

The bill also contains amendments to evidential presumption provisions in civil and criminal proceedings to assist copyright owners in the litigation process.

The bill contains amendments to give a court enhanced power to grant relief to copyright owners in civil actions which involve commercial-scale electronic infringement. In such cases, a court will be able to take into account likely infringements as well as a proved infringement in deciding what relief to grant.

Amendments to the Customs ‘Notice of Objection’ provisions will reduce the administrative and cost burden on rights holders in lodging notices and providing security for notices. The bill ensures that the Notice of Objection provisions in the Act remain consistent with changes made by the Trade Marks Amendment Act 2006.

Unauthorised access to pay TV

Other key enforcement measures are new offences to tackle unauthorised access and use of pay TV services.

Copyright Tribunal

There are also amendments to enhance the jurisdiction and procedures of the Copyright Tribunal.Many of these amendments implement the Government’s response to the Copyright Law Review Committee’s report on the Jurisdiction and Procedures of the Copyright Tribunal.

Reference of the bill to Senate LACA Committee for report

The bill has been referred to the Senate Legal and Constitutional Affairs Committee for inquiry and report.

Exposure drafts of most of the amendments were made available to the public from my Department’s website prior to introduction of the bill to give interested parties the opportunity to consider them and prepare any comments for submission to the Senate Committee.

I look forward to the Committee’s report.

This bill is wide ranging but it is also targeted. It targets piracy, not the legitimate everyday behaviour of Australian consumers and institutions.

I commend the bill.


ENVIRONMENT AND HERITAGE LEGISLATION AMENDMENT BILL (No. 1) 2006

The Environment Protection and Biodiversity Conservation Act 1999 (known generally as the ‘EPBC Act’) is the Australian Government’s premier piece of environment and heritage legislation. The EPBC Act has now been in operation for just over six years—during this time the Act has gained wide acceptance across the Australian community, and has achieved real results for the environment.

The EPBC Act has established Australia’s place as a world-leader in environmental legislation. The Act has been acknowledged as a world-class and innovative piece of environmental legislation. It is one of the few environmental laws anywhere in the world that provides a comprehensive national approach to environmental protection and that deals with such a wide range of environment and heritage issues.

For the first time in our federation, the EPBC Act clarified the environmental roles and responsibilities of the Australian Government, and the linkages between it and the state and territory governments. The Act provides mechanisms for consultation and cooperation between those governments. It puts in place a streamlined environmental assessment and approvals process in a way that is predictable, transparent and efficient, employing statutory timeframes to ensure timely decision-making.

However, experience over the last six years has shown there are still ways in which the operation of the EPBC Act can be improved to optimise its efficiency while maintaining and enhancing its environmental effectiveness.

The Environment and Heritage Legislation Amendment Bill proposes those improvements. The same basic framework and general approach are to be maintained. The aim is to continue to strengthen environment and heritage protection while streamlining some of the provisions of the EPBC Act and providing greater capacity and flexibility for more strategic approaches to be employed.

Achievements under the EPBC Act

The keystone of the EPBC Act is the protection of the seven matters of national environmental significance for which the Australian Government has particular responsibility. These are:

  • World Heritage properties;
  • National Heritage places;
  • wetlands of international importance (that is, wetlands declared under the Ramsar Convention);
  • nationally listed threatened species and ecological communities;
  • listed migratory species;
  • the Commonwealth marine area; and
  • nuclear actions.

The EPBC Act provides for the assessment and approval of projects likely to have a significant impact on any of these matters of national environmental significance—probably the most well known of its functions. The EPBC Act also deals with a wide array of other environment and heritage matters. These include:

  • listing and protection of World Heritage properties, National Heritage places, Ramsar wetlands, threatened species and ecological communities, and marine and migratory species;
  • identification and protection of the Commonwealth’s own Heritage—important places within the Australian Government’s control;
  • regulation of actions on Commonwealth land or affecting Commonwealth land;
  • recovery plans, threat abatement plans and other types of plans to assist the protection of Australia’s unique biodiversity;
  • regulation of wildlife trade to ensure ecological sustainability and the humane treatment of wildlife;
  • strategic assessment and accreditation of fisheries;
  • protected area management; and
  • a range of activities to ensure compliance with, and enforcement of, the Act.

Since its introduction, the EPBC Act has achieved major environmental wins for Australia.

These include the establishment of the Australian Whale Sanctuary and the protection of all cetaceans (whales, dolphins and porpoises) within its waters. The EPBC Act has also provided national protection for the first time for Australia’s 64 Ramsar wetlands sites. It has provided comprehensive protection across the nation for the first time for our unique threatened species and ecological communities.

In all, almost 2,000 referrals of developments proposals have been made since July 2000 under the EPBC Act. More than 400 have required assessment and approval in order to protect matters of national environmental significance. Close to another 300 have not been required to undergo the EPBC Act approval process because they were designed in such a way as to avoid adverse impacts on matters protected by the Act. The EPBC Act has therefore protected matters of national environmental significance more effectively and more comprehensively than ever before in Australia’s history.

In addition, over 120 fisheries have been assessed and associated accreditations and declarations made. Nearly 200 new species, ecological communities and processes have been included on the various lists established by the Act. Over 250 threatened species recovery plans and 50 draft or finalised Ramsar management plans are in place. Over 370 places have been added to the National and Commonwealth Heritage lists. And over 15,000 permits dealing with wildlife protection have been issued.

The EPBC Act has afforded greater certainty in relation to Australian Government involvement in environmental matters, leading to changing attitudes and raised standards. Since the introduction of the EPBC Act, developers have become aware that their proposals will not proceed without adequate consideration of ecological sustainability. They are increasingly designing their projects and consulting government and the community with these principles in mind, with the result that the EPBC Act provides far more protection than previously for Australia’s rich and unique wildlife.

Significant legal successes have also been achieved, including record penalties for illegal land clearing activities, and the establishment of conservation agreements for threatened species affected by development. A new National Heritage regime has been initiated, already providing recognition and protection of 34 outstanding heritage places which have shaped the nation’s identity, such as the Port Arthur Historic site, and the Sydney Opera House.

Despite these successes, however, it has become apparent that the operation of the EPBC Act can be improved, particularly for those who make applications or nominations under the Act. Operational improvements can be achieved by reducing processing time and decision points affecting the environmental assessment and approval of proposed developments, using more strategic approaches, and providing greater incentive for development interests, the states and territories, and local government to engage with the Act earlier in their planning cycles.

The necessary changes can be achieved in a manner that does not weaken protection for Australia’s important biodiversity and heritage, with the focus continuing to be on achieving strong environmental outcomes.

Changes to the EPBC Act

Within this context, the bill aims to make improvements in four distinct categories: streamlining administration of the Act for efficiency and effectiveness, thereby cutting ‘red tape’ in government; being more strategic and flexible in directing Australian Government action on the environment; strengthening compliance with, and enforcement of, the EPBC Act; and, finally, implementing a range of minor amendments needed to overcome some technical deficiencies in the Act.

Streamlining for efficiency and effectiveness—cutting ‘red tape’ in Government

Cutting red tape is a priority for the Australian Government. The January 2006 Banks report to the Government entitled Rethinking Regulation: Report of the Taskforce on Reducing Regulatory Burdens on Business concluded, among other things, that current Australian regulation imposes excessive and unnecessary costs on business. While the Banks Taskforce did not make any recommendation to change the regulatory regime of the EPBC Act, the Government has been mindful in reviewing the EPBC Act to examine the nature of the EPBC Act processes to ensure that the Act’s processes are as efficient and effective as possible. In particular, the Government sees no need for administrative process for process’ sake. If we can reduce ‘red tape’ without compromising environmental protection, then this is what we will do.

In this context, the bill contains many amendments, some of which are of a technical nature, designed to reduce duplication and complexity. For example, the bill proposes the streamlining of project assessment and permit stages so that once a project is assessed and approved under Chapter 4 of the EPBC Act, subsequent protected species permits may be issued under Chapter 5 without further assessment. Currently, the permit regime of the Act is separate from project assessments and approvals. The bill also eliminates current difficulties in accrediting or recognising fisheries managed under the Torres Strait Fisheries Act 1984 and the Fisheries Management Act 1991.

The proposed changes will include greater capacity to reduce processing time for assessments and approvals of developments referred under the Act by reducing the number of mandatory steps taken by applicants and enabling the Australian Government to make decisions on different Act approval stages simultaneously. A new process will be introduced to enable the Government to make quicker decisions on more straight-forward proposals.

The bill also allows World Heritage properties to be transferred across to the National Heritage List without the need for further assessment. This will increase efficiency and avoid duplication in the consideration of our World Heritage sites, such as Kakadu National Park or the Great Barrier Reef, on the list of places of most heritage significance to our nation.

The bill also allows for improved cooperation on environmental assessment and approval processes between the Australian Government and state and territory governments. These improvements should assist state and territory governments to respond positively to the Banks Taskforce recommendations calling for more bilateral agreements (which will remove duplication between state/territory and federal environmental assessment and approvals) to be signed under the EPBC Act.

Changes to the EPBC Act will clarify responsibilities for proponents and simplify the referral, assessment and approval processes. The bill will also allow the Minister for the Environment and Heritage to publish policy statements on the application of the

EPBC Act that will assist decision-making and inform the community. The policy statements will enable regional and local planning schemes to be prepared in a manner which will facilitate their accreditation under the EPBC Act, providing greater certainty for all.

The proposals to streamline the EPBC Act will provide substantial benefits to the nation. They will benefit industry and the economy in a way that will maintain our strong commitment to protecting Australia’s unique and iconic natural, historic and Indigenous heritage. They will ensure that ecologically sustainable development becomes an ongoing reality for Australia.

Being more strategic and flexible

One of the major changes proposed by the bill is a practical proposal to put in place a strategic framework that will allow the Australian Government greater flexibility and capacity to deal with the emerging environmental issues of the twenty-first century.

One way in which the bill achieves this objective is to provide greater incentives for authorities and proponents to engage in strategic assessments, bioregional planning and conservation agreements under the EPBC Act. While the EPBC Act currently provides for such strategic approaches, the take-up to date has been poor. Changes will make it easier for developments to be considered earlier in the planning process and in strategic and regional contexts. As these approaches are also likely to take state, territory and local government and regional natural resource management plans into account, they will provide a stronger and more strategic framework for environment and heritage protection.

The bill also provides for a more strategic approach to the listing of heritage places and threatened species and ecological communities. The roles of the Australian Heritage Council and the Threatened Species Scientific Committee will also be expanded to enable a strategic approach to be taken to listing. In future, roles of the Council and Committee will be restructured to provide advice to the Minister on annual work programmes, which will be based on the strategic importance of nominations and other listing proposals rather than, as now, simply when they happened to be nominated. Both the Council and the Committee will retain their expert independent status as the Minister’s advisers on these matters.

To complete the transition to a three-tiered heritage system for governments as proposed by the Council of Australian Governments in 1997, the Register of the National Estate is to cease to be a statutory register. This will not occur until after a transition period of five years which will allow states and territories to complete the task of transferring places to state, territory and local heritage registers. The Register will be maintained on a non-statutory basis as an important archive.

The bill will also establish the List of Overseas Places of Historic Significance to Australia, which will allow for the symbolic recognition of overseas sites that have a special place in Australia’s history. This change will allow Australia to keep a statutory list of these important places in a way that does not give rise to perceptions that this may affect the sovereignty of other countries.

Similarly, the bill will shift the focus from recovery plans to recovery action for our threatened species and ecological communities. New listings will be supported by conservation advice prepared by the Threatened Species Scientific Committee, which will lay out practical conservation actions that can be implemented by local and regional interests. Recovery plans will still be developed but recovery documentation will be more flexible than currently prescribed.

Another area of strategic reform is the alignment of the EPBC Act and the Fisheries Management Act 1991. The bill will provide increased scope for the fisheries regulator to manage depleted fisheries to environmental and economic sustainability. Through listing such species as conservation dependant where they are supported by appropriate management plans, we can be confident of their long term survival in nature. The EPBC Act will continue to provide the regulatory underpinning for the protection of such marine fish species. Should the recovery targets of a management plan not be achieved, the EPBC Act provisions will allow for the threatened species listing of that particular marine fish species to be upgraded to a higher level of threat with an accompanying higher level of protection.

Strengthening compliance and enforcement

While there have been a number of successes in ensuring compliance with the EPBC Act during the first six years, practice has shown that the current provisions are often difficult to use. The proposed amendments will strengthen environmental protection by fixing these problems and making it easier and quicker to bring compliance action against people and organisations that breach the Act.

The bill establishes a range of new enforcement options as an alternative to lengthy and expensive court proceedings. The amendments will enhance enforcement action taken to address minor breaches of approval conditions by allowing the use of a new set of reduced penalties. Changes to the Act will also broaden the powers of the Minister for the Environment and Heritage to require remediation action where matters of national environmental significance have been damaged without the need for resort to court action.

The amendments will broaden the types of conditions to be attached to development approvals to allow voluntarily compensatory actions and financial contributions to offset the impacts of developments in situations where impacts are unavoidable.

The bill will also introduce a regime to deal with the increasing problem of environmental crimes conducted by foreign nationals in fishing vessels in the Australian jurisdiction but outside the migration zone. The regime will provide for detention of suspected persons in Australia and the transition, if necessary, from environment detention to immigration detention under the Migration Act.

Minor technical amendments

The bill also proposes a range of minor technical amendments. In general, these are designed to improve efficiency and effectiveness. In some cases, they seek to clarify processes. For example, the bill sets out a new way of handling requests for reconsideration of decisions taken under the Act. This new process is quicker and more efficient while still allowing all interested parties to have their views heard.

Closing

In conclusion, the changes to the EPBC Act proposed by this bill will ensure matters of national environmental significance continue to receive the highest possible level of protection. They will cut ‘red tape’ and enable quicker and more strategic action to be taken on emerging environmental issues. They will make environmental decision-making more efficient and cost-effective. They will provide greater certainty for industry while, at the same time, strengthening compliance with, and enforcement of, the EPBC Act. They will make regional decision-making with its better strategic framework a priority and increase the general understanding of the processes and mechanisms of the EPBC Act.

The bill will build on the substantial environment and heritage gains so far achieved under the EPBC Act and provide the framework for Australia to move forward in the twenty-first century. The proposed changes will strengthen the EPBC Act’s environmental protection regime and increase its effectiveness by facilitating more strategic approaches while, at the same time, reducing the extent to which the Act is process driven in a non-productive manner.


INSPECTOR OF TRANSPORT SECURITY BILL 2006

Transport security in Australia continues to compare well with benchmark countries. There has been significant cooperation between Australian governments to improve transport security over recent years. Aviation and maritime security legislative regimes have been strengthened, and State and Territory governments have been working to improve the security of the surface transport sector.

The Inspector of Transport Security Bill provides a strong legislative basis to support the conduct of independent and impartial inquiries into Australia’s transport security arrangements. Upon direction by the Minister for Transport and Regional Services, the Inspector of Transport Security will be able to inquire into major transport security incidents and patterns or series of incidents that point to a systemic failure or possible weaknesses or vulnerabilities in aviation and maritime transport and security regulated offshore facilities. There is also the ability for the Minister to task the Inspector with an inquiry into surface transport security. This will require the agreement of the relevant State or Territory Minister and the scope of the inquiry will be agreed between Ministers.

The Inspector of Transport Security will not be responsible for regulating transport security in this country. The Office of Transport Security in the Department of Transport and Regional Services has the responsibility for the day to day regulation of transport security in the aviation and maritime sectors.

The strengths of the legislative framework to support the role of the Inspector of Transport Security include:

  • the independence of the Inspector;
  • the no-blame nature of the Inspector’s inquiries;
  • protection of information collected as part of the inquiry; and
  • the recognition that the work of investigative agencies should not be interfered with by inquiries undertaken by the Inspector.

This bill enshrines the independence of the Inspector. While the Minister for Transport and Regional Services tasks the Inspector with an inquiry, the Inspector is not subject to direction from the Minister for Transport and Regional Services in the conduct of that inquiry. Nor is the Inspector subject to direction from the Secretary of the Department of Transport and Regional Services or any other public servant.

Another key feature of this bill is the “no-blame” aspect. The purpose of an inquiry by the Inspector is not to gather evidence to apportion blame—other agencies properly exercise that role. Instead an inquiry by the Inspector of Transport Security will be seeking to establish how our already robust transport security arrangements can be improved. To ensure this, the bill provides that reports from the Inspector are not admissible in proceedings which seek to apportion blame. Importantly this will include disciplinary proceedings.

To further emphasise the “no-blame” aspect the bill ensures that except for coronial inquiries, the Inspector, employees or third parties involved in an inquiry cannot be compelled to provide evidence in any proceedings.

Another key feature of the legislative framework is that protections are in place for information provided to the Inspector in the course of an inquiry. All information gathered in the course of an inquiry is exempt from a Freedom of Information request. In addition, the bill protects information provided to the Inspector in the course of an inquiry. Breach of these protections can result in up to two years’ imprisonment.

When the provisions in the bill regarding On-Board Recordings and Cockpit Voice Recordings were being drafted, the Australian Government was aware of the importance of protecting this type of information to fulfil our obligations under Annex 13 of the Chicago Convention and to ensure that safety investigations by the Australian Transport Safety Bureau are not affected. The bill protects this type of information by ensuring that On-Board Recordings and information arising from safety investigations will only be available to the Inspector through the Executive Director of the Australian Transport Safety Bureau. Before agreeing to disclose this information, the bill requires the Executive Director to make a judgement that the public interest is served by disclosing the information. If the Inspector obtains this information from the Executive Director of the Australian Transport Safety Bureau the Inspector is then bound by strict restrictions in its use as part of the inquiry or in reports.

This bill balances two competing policy interests. One is to establish a “no-blame” legislative framework to encourage the provision of information to the Inspector that will contribute to improving transport security. The second is to ensure that, where information acquired by the Inspector in the conduct of an inquiry indicates that a serious offence is imminent, the legislation provides that the Inspector may disclose this information to the appropriate law enforcement bodies.

If the Inspector receives sensitive On-Board Recording or Cockpit Voice Recording information that indicates that a serious offence is imminent and the information may be relevant to preventing a crime, the Inspector may only reveal this information to the relevant agency if a Judge or member of the Administrative Appeals Tribunal agrees that the information should be disclosed.

It is important to note that the role of the Inspector is not one of a law enforcement agency. The Inspector’s inquiries will not hinder the important work of law enforcement agencies. The Inspector will work cooperatively with State and Territory governments and relevant agencies of the Australian government with direct investigative roles such as the police or the Australian Transport Safety Bureau. The bill contains specific provisions encouraging such cooperation. For example, the Inspector may provide information from a transport security inquiry to the Australian Transport Safety Bureau where it is requested and disclosure of it will not adversely affect a current or future inquiry.

In preparing this bill extensive consultation has been undertaken with industry stakeholders and state and territory governments. Issues that have arisen during the consultation process have been wherever possible taken into account. The Government has worked hard to address concerns raised.

This bill will further provide quality assurance for transport security as it establishes the Inspector of Transport Security who will conduct no-blame inquiries focussed solely on improving transport security for all Australians.


INSPECTOR OF TRANSPORT SECURITY (CONSEQUENTIAL PROVISIONS) BILL 2006

The Inspector of Transport Security Bill 2006 is a part of this Government’s commitment to ensuring a safe and secure transport system and is vital to our national security and our economic security.

A very important feature of the bill is the protections that are in place for information provided to the Inspector of Transport Security in the course of an inquiry. These protections are intended to encourage full disclosure to the Inspector. The protections provide that the information gathered by the Inspector generally can only be used for the purposes of the inquiry.

To provide further support for the protection of information generated or gathered in the course of an inquiry this bill amends the Freedom of Information Act 1982 to ensure that the information is exempt from a Freedom of Information request.

This bill gives the added protection to information that is required to encourage those that have valuable information to come forward and provide that information to assist the Inspector in his inquiry without fear of it being disclosed.


MARITIME LEGISLATION AMENDMENT (PREVENTION OF POLLUTION FROM SHIPS) BILL 2006

The Maritime Legislation Amendment (Prevention of Pollution from Ships) Bill amends the Navigation Act 1912 and the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 to implement revised Annex I (prevention of pollution by oil) and revised Annex II (prevention of pollution by noxious liquid substances) of the International Convention for the Prevention of Pollution from Ships, commonly known as MARPOL. Annexes I and II set out technical requirements aimed at preventing and minimising ship-sourced oil and chemical pollution respectively.

Amendments to Annexes I and II were adopted by the International Maritime Organization in October 2004, and the revised Annexes will enter into force internationally on 1 January 2007. The bill should commence on 1 January 2007, to coincide with the international entry into force of the revised Annexes I and II.

Revised Annex I, Regulations for the prevention of pollution by oil incorporates recent initiatives which reflect the development of technical best practice in the maritime industry, such as phasing-in double hull requirements for oil tankers and designating new regions as “special areas” under the Annex. “Special areas” are areas considered to be so vulnerable to pollution by oil that oil discharges within them have been completely prohibited, with minor and well-defined exceptions.

The structure of Annex I has been simplified to facilitate ease of interpretation of the requirements under the Annex. No substantive changes have been made to the technical requirements. It incorporates the various technical amendments adopted since MARPOL entered into force in 1983.

Revised Annex II Regulations for the control of pollution by noxious liquid substances in bulk includes a new four-category categorization system for noxious and liquid substances, which will change the current carriage requirements for some chemicals.

Revised Annex II also includes changes to permissible levels of discharge for some noxious liquid substances. Improvements in ship technology have made significantly lower discharge levels of some noxious liquid substances attainable and cost effective. The discharge levels which are now acceptable under Annex II have been lowered to reflect the progress made by new technologies. For ships constructed on or after 1 January 2007 the maximum permitted residue in the tank and its associated piping left after discharge will be set at a maximum of 75 litres for products in categories X, Y and Z—compared with previous limits which set a maximum of 100 or 300 litres, depending on the product category.

The bill will incorporate the internationally accepted changes to Annexes I and II into Australian domestic law, allowing Australia to enforce the more stringent technical requirements contained in the revised Annexes to protect human health and the marine environment.

The bill amends the Navigation Act 1912 and the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 to ensure that all amendments to the Annexes are implemented in domestic law, and that references to the two Annexes in existing legislation reflects the new structure and content of the revised Annex I and II.


MEDIBANK PRIVATE SALE BILL 2006

The Australian Government has always recognised the importance of the private health insurance industry as an essential partner to the public health sector.

Members will be aware that my Department and the Department of Health and Ageing are consulting industry on a range of reforms to the private health insurance industry.

These reforms are aimed at:

  • making private health cover more affordable;
  • improving customer access to information about health insurance products, to help customers make decisions about the cover they need; and
  • streamlining the regulation of the industry while maintaining the benefits of competition and strong prudential oversight.

The reforms will be the first big changes to health insurance legislation since the early 1990s and will give health insurers the opportunity to provide policies that reflect contemporary clinical practice and provide more competition and improved services to consumers.

The Government is committed to maintaining a viable and competitive private health insurance industry and the sale of Medibank Private represents an opportunity to improve industry competition and thereby benefit consumers. This bill provides the legislative framework to facilitate the sale.

The private health insurance sector comprises 38 funds. The Australian Government, through the Minister for Health and Ageing, has a critical role to play in the regulation of these funds and the products they offer to the public.

There is no sound policy reason for the Australian Government to continue to own a health fund. Competition between funds is the best way of keeping a lid on premiums. Importantly, if a customer of any health fund is unhappy with the fund’s premiums, they are able to move to another fund without any waiting period.

The private health insurance industry will also benefit from the largest health fund being privately-owned and competing on a level playing field. Further, selling Medibank Private will allow the Australian Government to remove its conflict of interest in being both the industry regulator and the owner of the largest participant in that industry, thereby allowing the Australian Government to focus on its role as regulator.

Decisions about implementing the sale of Medibank Private will be made in the context of the Australian Government’s objectives for the sale:

  • to contribute to an efficient, competitive and viable private health insurance industry;
  • to maintain service and quality levels for Medibank Private contributors, including in regional and rural Australia;
  • to ensure the sale process treats Medibank Private employees in a fair manner, including through the preservation of accrued entitlements;
  • to minimise any post sale residual risk and liabilities to the Commonwealth; and
  • having regard to the above objectives, to maximise the net sale proceeds from the sale.

These objectives emphasise the Australian Government’s focus on the benefits to customers and the industry arising from the current reform process and in the sale of Medibank Private.

The current board, Managing Director and management of Medibank Private have done an excellent job turning around the company’s finances and putting it in a position where there is significant interest from potential buyers.

Claims that the sale of Medibank Private will somehow increase premiums for health cover are unfounded.

  • Competition for members between funds is the best way to limit premium increases. Consumers, and the industry as a whole, will benefit from the largest health fund being privately owned and competing on a level playing field.
  • A detailed study by Carnegie Wylie also concluded that a privately-owned fund would be able to be more efficient, through lower management expenses and through scope for expansion into new business areas. A privately owned Medibank Private could expand into other areas, be they other forms of insurance or other medical products or other financial products—and through this greater scope, be a more efficient operation. And it is through more efficient operation that a health fund can further restrain premium growth.
  • There are already 5 ‘for profit’ private health insurance funds operating in Australia and there is no evidence that these ‘for profit’ insurers charge higher premiums than other health funds.

The Government in the 2006-07 Budget has already announced increased funding for medical research a result of the sale of Medibank Private.

The bill facilitates the sale of Medibank Private, but provides flexibility to the Commonwealth regarding how that sale will be carried out.

Importantly, the bill permits Medibank Private to change from a company run on a “not for profit” basis to being run for profit. As I mentioned earlier, there is no evidence that health insurers that are run for profit charge their customers higher premiums. To the contrary, commercial market pressures associated with being a for profit company provide strong mechanisms in restraining premium growth.

The bill also sets out a range of provisions relating to the conduct of the sale, including providing for exemptions from the Corporations Act 2001 and other legislation.

The bill also amends the National Health Act 1953 to clarify the circumstances in which a registered organisation run for profit can distribute profits or return capital, and to facilitate any restructuring of Medibank Private that may be necessary to ensure that the Commonwealth’s competition objectives of the sale are met. These amendments are consistent with the more wide ranging amendments being developed by the Australian Government with industry and preserve the oversight role of the Private Health Insurance Advisory Council.

Importantly, the bill does not affect the obligations of Medibank Private Limited to comply with the capital adequacy and solvency standards under the National Health Act 1953, or the other obligations Medibank Private has under that Act as a registered health benefits organisation.

In addition to other measures, the bill limits individual share ownership to 15 per cent of the company for five years and requires that Medibank Private remain based, incorporated and headquartered in Australia and that the majority of the Directors be Australian citizens, also for a period of five years. The shareholder cap will provide the company with an extended period for consolidation where it can concentrate on internal reform, secure in the knowledge that it will not be subject to hostile takeover. Further, the “Australianness’ provisions will provide stability for Medibank Private employees and contributors in the period following the privatisation, and would reduce the risk that market forces would lead to any precipitous structural change immediately following the sale.

Ordered that further consideration of this bill be adjourned to the first day of the next period of sittings, in accordance with standing order 111.

Ordered that the Inspector of Transport Security Bill 2006 and the Inspector of Transport Security (Consequential Provisions) Bill 2006 be listed on the Notice Paper as one order of the day and the remaining bills as separate orders of the day.