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Wednesday, 15 February 2017
Page: 1045

Senator CORMANN (Western AustraliaMinister for Finance and Deputy Leader of the Government in the Senate) (17:58): 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 speech es read as follows—


In January this year, the Prime Minister made a commitment to establish the Independent Parliamentary Expenses Authority, which will ensure that parliamentarians' work expenses are accountable, transparent, and fair.

Politicians must be accountable for their use of taxpayers' dollars. Australians are entitled to expect that politicians spend taxpayers' money carefully, ensuring at all times that their work expenditure represents an ethical, prudent, and cost-effective use of public resources.

The Government is opposed to the idea of entitlements. These are business expenses and we as politicians should spend them as frugally, if not more frugally than we would our own money. They should only be spent for the purpose of doing our job and we must be accountable for them.

The Independent Parliamentary Expenses Authority Bill 2017 is the first step in the biggest reforms to the management of parliamentarians expenses in more than a generation.

IPEA will be an independent authority, charged with administering and overseeing the travel and related expenses of parliamentarians. This already happens in some jurisdictions - most notably in the United Kingdom.

IPEA's core functions will be to audit and report on parliamentarians' work expenses. It will also provide advice, monitor and administer claims for travel expenses and allowances by parliamentarians and their employees, ensuring that taxpayers' funds are spent appropriately and in compliance with the rules.

The functions will be provided at arms-length from government - distance in this case, being essential to maintaining confidence in the decisions of the body, protecting against partisanship, and shielding against misuse.

IPEA will be an independent authority with an independent board comprised of individuals with diverse yet highly relevant skills, as well as with substantial experience and significant standing within their professions. The board will be responsible for the statutory functions of IPEA while a Chief Executive Officer (CEO) will manage the day-to-day operations.

The members of the board will include a former judge, a former Member of Parliament, a person who has significant experience, knowledge, and standing in the field of auditing and the president of the Remuneration Tribunal. With this depth and breadth of experience, the Authority will exemplify a high standard of independence and accountability.

Together with the CEO, the board will provide confidence to administrators, parliamentarians and the Australian public that public money is spent appropriately, in accordance with the rules, and in a manner that ensures value for money.

Under the current system, parliamentarians and administrators navigate a complex work expenses framework that is comprised of legislation, regulations, determinations, procedural rules, guidelines, conventions and decisions of executive government.

IPEA is intended to provide clear and consistent guidance, advice and rulings for parliamentarians. Clear advice and guidance is crucial. Currently, it is often necessary to read several instruments in order to understand a single work expense. The Department of Finance, for example, has had to produce a suite of eight separate handbooks on the patchwork of legislation and guidelines that form the work expenses framework.

The change that will have the greatest impact on transparency is the modernisation of the system that manages work expenses. Our current system of six-monthly reporting will be updated as soon as possible to allow for a monthly disclosure of parliamentarians' expenses in an accessible and searchable format. This process of modernisation will bring Australia into step with other jurisdictions around the world, and ensure a greater degree of transparency, accountability and integrity in the use of public funds.

The bill will create the IPEA but we need to go further. In order to support this reform the Government will continue to implement the recommendations of the review chaired by John Conde and David Tune into the parliamentary entitlements system.

The Government will present a further significant bill to the parliament, in the near future, which will improve the legislative and administrative framework of the parliamentary work expenses system - further encouraging transparency, accountability and value for money. IPEA will perform its functions both in respect of the current framework, then the new framework once it has been reformed.

The IPEA will commence on 1 July 2017, fully supported by these changes to Parliamentary work expenses.

In recognition of the immediate need for reform in this area, while we work to establish the IPEA and reform the work expenses framework, an interim advisory body will be established by executive order. This body will include a board and will administer travel expenses and allowances, and provide advice and support to parliamentarians on the current parliamentary work expenses system in respect of travel expenses and allowances. This body will commence as soon as possible, then will be abolished - and the board transitioned - upon commencement of IPEA.

As parliamentarians we have a duty to ensure that our spending of public money meets the expectations of the Australian public. Transparency and accountability are critical to meeting this duty. The IPEA is the first part of a robust response to the obvious shortcomings of the existing systems which will provide greater transparency and accountability as well as greater clarity to parliamentarians in recognition of the unique challenges that we face in representing our constituents across this wide land.

This bill is the first step in the biggest reforms to the management of parliamentarians expenses in over 25 years. I look forward to working with our parliamentary colleagues to ensure that these important and timely reforms are delivered.


This Bill supports the Independent Parliamentary Expenses Authority Bill 2017 by addressing consequential matters that would arise from the enactment of the Independent Parliamentary Expenses Authority Act 2017.

The Bill would provide exemptions to the freedom of information scheme established under the Freedom of Information Act 1982 for the Independent Parliamentary Expenses Authority in relation to documents requesting that the Authority give personal advice relating to parliamentary work related travel expenses and allowances to parliamentarians and their staff. The exemption also extends to any other documents connected with the performance of those functions.

These exemptions are intended to ensure that the Authority can provide frank advice to parliamentarians and their staff, and to encourage parliamentarians and their staff to engage with the Authority at an early stage to seek guidance where they are unsure of their travel expenses or allowances.

Debate adjourned.

Ordered that resumption of the debate be made an order of the day for a later hour.