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Monday, 4 July 2011
Page: 3909


Senator McLUCAS (QueenslandParliamentary Secretary for Disabilities and Carers) (17:00): 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—

FINANCIAL FRAMEWORK LEGISLATION AMENDMENT BILL (NO. 1) 2011

The Financial Framework Legislation Amend ­ ment Bill (No. 1) 2011 would, if enacted, amend 8 Acts across 5 portfolios to help further clarify aspects of the Commonwealth's financial framework.

This Bill is the eighth Financial Framework Legislation Amendment Bill since 2004, and forms part of an ongoing program to address financial framework issues as they are identified, taking a collaborative and whole-of-Government approach.

The work behind this Bill has already been partially presented to Parliament through the Statute Stocktake Bill (No. 1) 2011, which I tabled on 23 March 2011 to repeal 39 redundant special appropriations relating to the Commonwealth's financial framework.

The breadth of appropriation, governance and financial management issues across the Government compel continued attention. For this reason, the Department of Finance and Deregulation works with all parts of Government, in a culture of strong collaboration, to address statutory financial framework issues promptly.

Accordingly, this Bill seeks to amend 2 Acts in the Finance and Deregulation portfolio, but also 6 Acts in 4 other portfolios. These are: the Attorney-General's portfolio; the Agriculture, Fisheries and Forestry portfolio; the Climate Change and Energy Efficiency portfolio; and the Innovation, Industry, Science and Research portfolio.

Specifically, Schedule 1 of the Bill contains minor amendments to the Commonwealth Authorities and Companies Act 1997 to enable the content requirements for the corporate plans of government business enterprises to be specified under regulations, rather than in the Act. This allows that content to be updated more readily.

Schedule 2 of the Bill contains minor amendments to the Financial Management and Accountability Act 1997 (FMA Act) primarily to clarify the legal status of various legislative instruments, such as determinations, instructions, and guidelines issued under that Act or under its regulations. There is also an amendment to clarify that the Auditor-General is the external auditor of FMA Act agencies.

Schedule 3 of the Bill then makes consequential amendments to the Legislative Instruments Act 2003 and removes reference to an instrument under the FMA Act that is now redundant. As a result, the matters dealing with the Legislative Instruments Act 2003 will be covered in the FMA Act alone.

Schedules 4 to 8 of the Bill contain minor amendments to 5 Acts of Parliament.

These amendments seek to:

update the Wheat Export Marketing Act 2008 to clarify the scope of credits to the Wheat Exports Australia Special Account;

amend the WineAustralia Corporation Act 1980 to update the circumstances in which the Wine Australia Corporation must provide their annual operational plan to the responsible Minister, and clarify the term in office of a member of the Geographical Indications Committee;

update a reference in the Renewable Energy (Electricity) Act2000 to the 'Australian Bureau of Agricultural and Resource Economics and Sciences';

remove a redundant reference to the former name of the 'Australian Bureau of Agricultural and Resource Economics and Sciences' in the Primary Industries (Excise) Levies Act 1999; and

repeal a redundant paragraph and make technical amendments to the Science and Industry Research Act 1949.

This short Bill is, accordingly, another step to help ensure that specific provisions within our financial legislation remain clear and up-to-date.

HIGHER EDUCATION SUPPORT AMENDMENT (DEMAND DRIVEN FUNDING SYSTEM AND OTHER MEASURES) BILL 2011

The Australian Government is committed to transforming the scale, potential and quality of higher education in Australia.

When we came to office in 2007, we under­stood very clearly the transformative potential of higher education.

We understood that new investment and reform was required to allow our nation’s universities to meet the increasing demand for higher qualifications from students and employers, to meet our nation’s future workforce needs.

In 2008, the Government commissioned a wide ranging Review of Australian Higher Education, known as the Bradley Review.

This review was the catalyst for the major package of reforms, Transforming Australia’s Higher Education System, announced in the 2009 10 Budget.

The Higher Education Support Amendment (Demand Driven Funding System and Other Measures) Bill 2011 which I am introducing today will implement more of the reforms announced in that package.

Fundamental to the Government’s reforms has been the understanding that the Australian economy today - and the Australian economy of the future - will require more Australians to be degree qualified.

The demand for ever more sophisticated goods and services will require higher levels of innovation and skills in our workforce.

In Australia today, the demand for professionals, managers, and community and personal services workers is outstripping demand for clerical workers and labourers.

More professionally qualified people, engineers and managers will be needed by 2015. We will need them in the health care sector. We will need them in the mining sector. We will need them to respond to future challenges that arise across the breadth of the Australian economy.

This is why the Government has made a commitment to the expansion of a high quality university sector, to educate the graduates needed by an economy based on knowledge, skills and innovation.

This approach is essential if Australia is to participate fully in, and benefit from, the global knowledge economy.

The Government has set an ambitious goal for national attainment. It is seeking to increase the proportion of 25 to 34 year old Australians with a qualification at bachelor level or above to 40 per cent by 2025.

This was one of the major reasons the Government committed to demand driven funding for undergraduate student places at public universities.

We are committed to funding growth in undergraduate student places and to opening the doors of higher education to a new generation of Australians.

The Bill being introduced today gives effect to that commitment.

The Bill reforms the Commonwealth Grant Scheme which provides the Australian Government’s financial contribution to a student’s place at university.

Australian universities will no longer be asked by the Government to ration Commonwealth supported student places among students competing to get a bachelor degree.

The Government will make its financial contribution to the cost of educating all students admitted to undergraduate courses of study.

The Government will no longer set the number of undergraduate places that a university can offer.

From 1 January 2012, universities will have greater flexibility to respond to student demand, and employer and industry needs.

The Commonwealth Grant Scheme is to be changed so that universities will be funded, not on the number of places which the Education Minister decides they will be given, but based on the number of places they provide.

The legislated cap on the Commonwealth Grant Scheme is being removed by the Bill.

By 2012, the Government will have increased higher education expenditure on teaching and learning by 30 per cent in real terms since 2007.

This year, the Government will fund more than 480,000 undergraduate places at public universities.

With an anticipated 4 per cent growth, next year this will rise to over half a million places - a 20 per cent increase since 2008.

To fund this historic expansion of opportunity, the Government provided an additional $1.2 billion in this year’s Budget, bringing the total demand-driven funding to $3.97 billion over successive budgets.

The Government recognises that it will continue to have a role in the national oversight of our higher education sector.

It will retain some powers to assist achievement of those outcomes and to enable it to respond to national imperatives.

Higher education providers will continue to be required to have a funding agreement with the Commonwealth in order to be eligible to receive Commonwealth Grant Scheme funding. The Bill amends some provisions relating to these funding agreements.

The most significant of these amendments relate to the specification of maximum basic grant amounts.

These changes are required by the change to the method of calculating the amount of grant a university will receive under the Commonwealth Grant Scheme.

In addition, there may be circumstances in which the Australian Government needs to limit the extent of future growth in unallocated undergraduate places. The Minister will be able to do this by specifying a maximum basic grant amount for these places in a university’s funding agreement.

Significantly, the Minister will not be able to specify an amount that would reduce the funding for undergraduate student places that a university receives from one year to the next.

The Government will not be specifying any maximum basic grant amount for unallocated undergraduate places in any funding agreement for 2012.

It also does not plan to do so in future years, but the Government does wish to ensure that growth in undergraduate courses is sustainable, does not involve excessive risk and that the Government’s fiscal position is properly managed.

The Government is not uncapping funding for student places in postgraduate and medical courses. It will continue to allocate Common­wealth supported places in these areas.

The Government will be maintaining each university’s current target for postgraduate student places in 2012. It will also be ensuring that postgraduate student places that have been provided within the existing allowance for over-enrolment continue to be funded.

The Bill provides that the Government can specify in a university’s funding agreement a maximum basic grant amount for allocated places that is higher than the amount for the university’s target load.

The Government’s forward estimates of expenditure provide sufficient funding to ensure that there is no contraction in the level of Commonwealth supported postgraduate student places. It will be working with the sector to establish a framework for funding postgraduate places into the future.

The outcomes of the Base Funding Review will also be taken into account when considering future arrangements in the postgraduate coursework area.

In recent years, there has been a major expansion in the number of medical schools.

The number of domestic medical graduates is projected to rise from around 1900 to over 3100 - an increase of over 60 per cent.

This has placed significant pressure on the availability of clinical training places and internship opportunities. These are vital to maintaining the quality of graduating doctors.

For these reasons, the Government will not be removing the controls on student medical places at this time.

The Government will be monitoring demand and supply for graduates in all disciplines in the early years of implementation of the new funding system.

The Bill ensures that the Government has the capacity to respond to any new skill shortages and, if necessary, to the oversupply of graduates in particular areas.

Amendments to the Higher Education Support Act 2003 will ensure that the Government retains powers to allocate places for particular disciplines.

The Bill allows the Minister to declare a course of study to be a designated course of study. This will provide the Minister with the capacity to allocate places for those particular courses.

The Bill provides that such a declaration must be tabled in both Houses of Parliament and is a disallowable instrument.

The Government believes that the measures contained in this Bill for demand driven funding of undergraduate places provide for much needed investment in higher education.

As a result of these reforms, universities will be able to grow with confidence and diversify in response to student needs.

Consistent with the shift to a demand driven funding system, the Government agreed in its response to the Bradley Review that the Student Learning Entitlement (SLE) provisions of the Act would be abolished from 2012.

The SLE currently limits a person’s ability to study at university as a Commonwealth supported student to the equivalent of seven years full-time study, subject to exceptions specified in the Act which allow for further periods of ‘additional’ SLE and ‘lifelong’ SLE to be allocated.

Application of the SLE has resulted in instances of hardship for particular students - for example, where a student who completes a three-year undergraduate science degree subsequently goes on to re-enrol in a six year medical degree. In cases such as these, students can exceed their SLE and no longer be eligible for a Com­monwealth supported place.

The Bill repeals Part 3-1 of the Higher Education Support Act and amends other provisions of the Act to remove the SLE and its role in the various funding schemes under the Act.

The Bill amends the Higher Education Support Act to require that each Table A and Table B higher education provider enters into a mission-based compact with the Commonwealth. Compacts will provide for Commonwealth oversight of the teaching and research missions of universities.

Mission-based compacts provide an important process of dialogue and communication between universities and the Government.

Compacts provide assurance concerning the alignment of university missions with the Commonwealth’s national goals in the areas of teaching, research, research training and innovation. They do so in a way that recognises that the objectives of Government and universities are often shared.

In preparing compacts for the 2011-13 period, the Government has been made aware of universities’ growth strategies, their intentions for maintaining the quality both of teaching and the student experience, and their contributions to the Government’s attainment targets.

As a consequence, the Government is better informed about the future research directions of universities, their strategies to advance innovation and of their efforts to train Australia’s future research workforce.

The Australian Government will continue to work cooperatively with higher education pro­viders through compacts to ensure that individual university missions serve Australia well in teaching, research, research training and inno­vation. It will continue to monitor developments, progress and achievement across the sector.

The Bill will amend the Higher Education Support Act to promote free intellectual inquiry. Free intellectual inquiry is an important principle underpinning the provision of higher education in Australia. It is one that the Government has committed to include in the Act.

Free intellectual inquiry will become an object of the Act. The Government’s funding arrange­ments should not be used to impede free intellectual inquiry.

Table A and Table B providers will be required to have policies that uphold free intellectual inquiry in relation to learning, teaching and research. This will be a new condition of funding.

Most universities already have such policies and I know they all wish to support research and teaching environments which promote free intellec­tual inquiry. It is fundamental to the scientific method and rigorous scholarship. It is necessary to enable evidence to be challenged, competing theories to be debated and facts to be established. It provides the foundation for our understanding of the world and the accumulation of knowledge.

This Bill reflects the Government’s continued commitment to invest in Australia’s universities and to expanding opportunities for Australians to obtain a higher education degree.

As a consequence of this Bill and our investment in higher education, more Australians will have the opportunity to gain a university education.

In this next generation of students, there will be many people who will be the first in their family to embrace the opportunities that a university education can offer, with the promise of a high skilled, high paid job when they graduate.

Our industries will get the university-educated workforce they need. Our regional communities and industries will share in the benefits.

Australia will have a growing and sustainable higher education system which meets the needs of our nation.

PROTECTION OF THE SEA (PREVENTION OF POLLUTION FROM SHIPS) AMENDMENT (OIL TRANSFERS) BILL 2011

Australian transport relies almost entirely on oil products. A significant amount of Australia's oil is imported as crude oil for refining at one of Australia's seven oil refineries.

On occasions, crude oil is transported in super tankers. Because of their size, these large ships are unable to enter most ports. To enable their cargo to be taken to an oil refinery, it will often be transferred to two or more smaller tankers. There may also be other times when oil cargo is transferred between tankers.

While such transfers are rare in Australian waters, indeed the first and, so far, only such transfer was successfully carried out off the NSW coast in March of this year, it is important that they be carried out in a responsible manner.

The Marine Environment Protection Com­mittee of the International Maritime Organization has recognised the potential for pollution damage resulting from an oil spill during a ship-to-ship oil transfer operation. In July 2009, the Committee adopted amendments to Annex I of the International Convention for the Prevention of Pollution from Ships (MARPOL) to regulate ship-to-ship oil transfers. The purpose of this Bill is to implement those amendments in Australia.

The key provision of the Bill is the requirement for all tankers with a gross tonnage of 150 tons or more to have on board an operations plan setting out how ship-to-ship oil transfer operations are to be conducted. The carriage of such a plan indicates that a tanker is fully prepared to undertake STS oil transfers in accordance with the requirements of Annex I of MARPOL. Transfers are to be carried out in accordance with the plan.

Should a plan not be in place for a tanker involved in an oil transfer operation, then the risk of an oil spill would be greatly increased. Failure to have a plan would be an indication that the tanker may not have sufficient safeguards in place to avoid an oil spill and that there is the potential for major environmental damage resulting from the escape of oil during the oil transfer operation.

The ship-to-ship operations plans for Australian oil tankers will be checked and, if found to comply with the requirements of the amendments contained in this Bill, will be approved by the Australian Maritime Safety Authority.

The master of an oil tanker involved in a ship-to-ship oil transfer operation will be required to notify the administration of the country in whose waters the transfer is to take place. Notification is required at least 48 hours before oil transfer operations begin. This is to allow sufficient time for authorities to ensure that pollution response equipment is on standby in case of an oil spill during the transfer.

The requirements set out in the Bill will apply to all ship-to-ship oil transfer operations carried out from 1 April 2012. The requirements will also apply to any tanker which has undergone a survey to check compliance with safety and marine pollution prevention requirements between the date of Royal Assent of this Bill and 1 April 2012.

Since coming to power in 2007 this Government has significantly improved the protection of Australia's marine environment; this Bill continues that work.

STATUTE STOCKTAKE BILL (NO. 1) 2011

The Statute Stocktake Bill (No. 1) 2011 seeks to reduce red tape in the Government’s internal administration by repealing redundant special appropriations and a statutory Special Account.

This Bill is an important part of Government housekeeping in keeping the financial regulatory framework of the Commonwealth up to date.

The Bill, if enacted, will update legislation across a range of portfolios, by abolishing 39 special appropriations, including a statutory Special Account, repealing redundant provisions in 11 Acts and repealing 25 Acts in their entirety.

These redundant provisions have been identified through a stocktake of special appropriations. The Government committed to regular stocktakes of this nature in response to the report, Operation Sunlight - Overhauling Budgetary Transparency released with the Government’s response on 9 December 2008.

The Bill carries on from the efforts of 5 previous Financial Framework Legislation Amendment Actsfrom 2005 until 2010 and the Statute Stocktake (Regulatory and Other Laws) Act 2009, and contributes to Commonwealth efforts to clean up the statute book. The Bill also assists the Government to maintain effective legislative housekeeping, which is consistent with the Government’s Better Regulation Agenda.

The Billcontains no significant policy changes.

Schedule 1 of the Bill would, if enacted, repeal 13 special appropriations that have either been fully expended or would concern functions that are no longer being undertaken, such as the Loans (Australian Industry Development Corporation) Act 1974.

Schedule 2 of the Bill will repeal 26 redundant special appropriations, including 25 Acts and a statutory Special Account that no longer have any effect, such as the Forestry and Timber Bureau Act 1930.

The measures contained in the Bill reflect the Government’s commitment to enhance transparency and accountability across the Commonwealth’s financial framework.

I commend the Bill to the Senate.

Senator McLUCAS: I seek leave to continue my remarks later.

Leave granted; debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.