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Monday, 29 October 2012
Page: 8124


Senator MARK BISHOP (Western Australia) (10:41): This bill, the Defence Trade Controls Bill 2011, is a bill of some consequence and some considerable importance. It has been developed over a long period of time and really is the final stage of a long and arguably unsatisfactory process. I want to talk briefly about a number of aspects of the bill that relate directly to the bill itself. Firstly, I want to talk about the background to the bill and what has been the government's stated intent and purpose; secondly, I will talk about the process of consultation over an extended period of time going back some four or five years, but in its heart over the first nine months of this year; thirdly, I will talk about the outcome and amendments that will be circulated by the government, if they have not been already; and, finally, I will make some observations about going forward in terms of some recommendations from the Senate review. I refer particularly to recommendations 1 and 2 of the final report of the Senate committee.

Turning firstly now to the background, the bill gives effect to a treaty between Australia and the United States of America concerning defence trade cooperation. The bill gives effect to controls on the supply of Defence and Strategic Goods List technology and services related to that list of goods. That list is critical to a whole range of technologies, a whole range of export services and the work of a whole range of very, very important and critical institutions in this country: without going into infinite detail, all of the universities, the CRCs, the research tanks, the think tanks, the health community and all of those engaged in forms of applied and purer research that have application in the development of technologies or the development of services attached to those technologies that, because of the often groundbreaking nature of that work and research, have application across a multitude of fields and have interest from a multitude of countries and a multitude of companies in those various countries.

So we are talking of matters of significance, of critical importance and of consequence going forward and, accordingly, that being the case, the ability to research, to publish, to engage in commerce, to export, to engage in consultation with allies, close friends and important businesses that provide billions of dollars of hardware to this country. You would have thought that all levels of government would be alert to that consequence and to that importance and, accordingly, would take a deep and abiding interest in the process of consultation subsequent to the creation of a treaty between our two governments and its endorsement by the treaties committee in the House. Unfortunately I cannot say that has been the case.

The Senate Legislation Committee on Defence, Foreign Affairs and Trade was referred the Defence Trade Controls Bill in November 2011. The committee held public hearings on 2nd and 21 March. Based on a number of submissions and evidence received at the public hearings, the committee became aware for the first time that consultation undertaken by the Defence on the proposed legislation was seriously deficient and that, as a result, Defence was in the dark about the likely unintended consequences. Think about that for a minute. Defence from the beginning was in the dark about the likely unintended consequences of the bill.

Universities Australia and the University of Sydney informed the committee that the provisions of the bill would have a detrimental impact on scientific research in Australia. It should be noted that the explanatory memorandum for the bill included a regulation impact statement which stated that the effect on universities and research would be limited. So the government's formal position in writing in the explanatory memorandum, as prepared by Defence before the committee, was that it would have minimal impact on the research communities and, as was said at the committee's second March hearing:

… we do not understand how the regulatory impact statement can have assessed the impact on universities will be small when in its own submission it did not give any data to support its conclusion, and it did not consult with the university sector.

So the critical aspect of the explanatory memorandum attached to this bill as to what the bill was intended to do, said that there had been consultation with the university sector, with the research sector and that the impact would be minimal approaching nonexistence. On that basis, people who take the trouble to read EMs can usually presume that the stated words reflect the government's position and are accurate going forward. All the time I have been in this place, we have been able to rely on the wording in explanatory memoranda.

That paragraph that I just read was, and is, patently incorrect, and was drafted and published to mislead members of the committee. It can have been its only intent. You do not say that black is white and white is black without having a purpose in mind. Black is black, white is white, the two do not cross, and for the explanatory memorandum—which is an aid to construction of statutes when their interpretation is disputed in court—to say one thing when it is clearly the other borders on deliberate misrepresentation leading to wrong conclusions. I can find no other explanation for that to have occurred unless it was laziness or ignorance or lack of care, and if they are the excuses, they are excuses. But they are not and never can be reasons for committees of the parliament to be deliberately misled on bills that vitally affect the future of this country, the future of men and women who are fighting and dying in the field.

Laziness on the part of whomsoever in drafting provisions, in bills that are an aid to construction of a statute, can never be explained or forgiven. Going on from the quote I referred to, Sydney University also supported that view. It noted that when preparing the bill Defence had no information available to it indicating the number of activities in Australian universities likely to be affected. Furthermore, at the hearing on 21 March, Professor Mann, of the University of Sydney medical school, told the committee that Defence had grossly underestimated how many extensions there would need to be. Another of his colleagues informed the committee that discussion with Defence about such matters had started 'about an hour ago'. So, prior to the committee meeting, four months after the reference was given to the committee, after the publication of the bill, after the publication of the explanatory memorandum, after receipt of all the submissions and after publication of all the submissions, it occurred to Defence, an hour before the committee began its deliberations, that it should have some consultation. My god! If a most junior officer on day one, in a member of parliament's office, had engaged in such deliberately poor, ill-disciplined and slack behaviour, the member of parliament would be entitled to dismiss that person out of hand because clearly that person had no appreciation of the importance of his or her work and of the consequences of decisions but we had it given to us in spades whilst men were in the field dying every day. The two do not match.

A substantial part of Defence's consultation process with the universities and other relevant research stakeholders began after the March hearing, four months after the bill had been introduced and only after the committee recommended that Defence conduct that process—and think about that. So a legislation committee of the parliament, an arm of legislature, has to give written advice to the executive about how it should go about doing its job, doing its business. The executive, through its portfolio agency, had chosen not to do it and it required a committee to give advice to government how government in this portfolio should conduct itself.

As late as 30 May the National Health and Medical Research Council had informed the committee that while the university sector had been consulted the medical research institute and public health sector had not. So this is as late as 30 May. It also had strong reservations about the bill, noting the legislation may have ramifications not only for the university sector but also for other institutions that conduct health and medical research. At this late stage the Australian Research Council similarly indicated that the concerns raised were sufficiently serious as to justify further consultation with the universities about the proposed controls prior to their implementation. Even much later, in July, five months after the consultation process started and before the committee met, the Department of Industry, Innovation, Science, Research and Tertiary Education noted that, while Defence had dealt directly with Universities Australia and the University of Sydney, it had not done so with the broader range of universities. It suggested that universities may have different viewpoints and it would be desirable to broaden the consultation process to include all university members. Again, my God, what a ground-breaking thought, that there are more than two institutions in this country that are engaged in critical research and it might be nice to bring them up and say, 'Hey, all of those things you are doing in movement, transport, logistics and lasers, whatever it is, does it have any impact if we put you on a list and you cannot export your product or your services?' But, gee whiz, no: that was not thought of, that was not thought sufficiently important.

It gets better. As the consultation period drew to a close the committee received advice from the universities and research organisations that consultation had failed to come up with a workable compromise. Sometimes that happens. Universities Australia wrote to the committee.

Despite early promise of progress and a commitment from the department to work collaboratively, we have been disappointed that there has not been an opportunity for open or considered sectoral engagement on the issues and to date adequate responses to our concerns have not been provided.

Although the universities, research organisations and even the department of innovation advised the committee that there was still good will to negotiate a solution, Defence told the committee that it was 'unlikely that Defence and the university and research sectors would reach agreement on a preferred option. As a result consultation had moved towards the practical implementation of legislation.'

Think about that written advice from Defence and think of the time lines. In November the draft bill and EM are published and circulated, referred to a committee. Dates are set in March for hearings. An hour before the committee meets in March, Defence decides to initiate some form of consultation process. It goes through that in March, April, May, June and July. Then Defence says, 'This consultation process does not appear to be working too well. We don't appear to be getting what we want, so we are not going to do it anymore and the consultation is going to shift from content of bill to practical implementation of the legislation.' The legislation at that stage had not been considered, had not been amended, had not been the subject of any report. So the whole process from November of last year until the end of July on the part of Defence was just a farce. They came to the conclusion in writing, 'Well, we need to talk about the practical implementation.'

Understandably concerned about the situation, in August the committee published a preliminary report in which it urged Defence to undertake further consultation involving a roundtable approach proposed by Universities Australia. It also recommended that Defence participate in a roundtable of key stakeholders chaired by the Chief Scientist, Professor Chubb. The committee recommended further that the consultation between Defence and key stakeholders continue until the issues raised could be resolved to the satisfaction of all parties. The consultation was to be conducted in an open and transparent manner, allowing sufficient time for key stakeholders to consider the complex issues and respond.

Despite the roundtable process being completed, stakeholders continued to voice concerns, some more significantly than others, some in stronger language than others, some publicly but a lot privately. But, in terms of widespread ready acceptance within the universities and research sectors of this country, it is unfair to say even at this stage that there is widespread or even near-unanimous support for the content of this bill—not yet.

A range of institutions, organisations and corporations, some domiciled in this country and some offshore, are engaged in research valued at tens of billions of dollars—research that is used by our defence forces and exported to the defence forces of other countries, close allies who are similarly currently dying the field. We have this bill here before us today. We will hear from other speakers that there has been an extensive consultation process chaired by two eminent government scientists post August-September this year, and it has come down with a wide-ranging set of recommendations. That is correct. I was part of that committee, and I signed off on that report, and I accept that. It is correct. But heavens above! The only way we can get proper, thorough, detailed, meaningful, worthwhile consultation with critical sectors in this country is for a committee of the parliament to scream blue murder. That is the only way. After a while, that does not work. It does not have any effect. But in Defence we do not hear any explanation for that slow process. (Time expired)